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By Nitin Tuli
Over the past decade, the Indian passenger vehicle market has been the fastest-growing in its segment. India is expected to emerge as the world’s third-largest passenger vehicle market.
We have observed that competition is souring very fast with the entrance of new vehicle manufacturers, new launches, connected technologies, loaded features etc. It is making dealership retail targets all the more challenging. Hitting the targets is critical to the business sustainability of the original equipment manufacturers (OEMs).
“In the present changing business dynamics, the focus of OEMs and their dealerships shall move towards developing and prioritizing retail infrastructure by innovative means and methods.”~
Since a few decades, the priority of OEMs was production, distribution, network and after-sales service. Innovation in retail infrastructure was never a priority, mainly because retail was happening logically by the Standard Operating Procedures (SOPs). OEMs and their dealerships religiously follow SOPs through professional working, audits, hiring the best talent, making memorable customer experiences during sales and after-ales) etc.
But, in the present changing business dynamics, the focus of OEMs and their dealerships shall move towards developing and prioritising retail infrastructure by innovative means and methods.
Retail innovations
The following can be some of the innovations that can help in developing the retail infrastructure:-
a. Close-loop interaction with potential customers from the enquiry stage (first interaction) to the final stage (customer purchase of any brand) with a recording of customer behaviour, likes and dislikes, through this journey.
b. Making customer behavioural science and its analysis, a part of the new SOPs in retail infrastructure. This will help the retail team in projecting consumer’s purchase intention so that it can keep changing the strategy to address the customer in the best way possible.
c. Bringing gender diversity in the retail team, by equal representation of women in the workplace, to give positive impact, not only in retail business but across the dealership functions.
d. Organising weekly or monthly meet with potential customers as per the defined SOP.
e. Retail sales teams at dealerships shall be given unique names like Elite Members, Star members, Special Forces etc. because social scientists believe that names produce a Dorian Gray effect, (influencing personality, how we’re perceived, and even physical appearance), that will boost their performance.
f. Special training for retail teams, from behavioural aspects, presentation skills, communication, product knowledge etc. to other skills like vehicle financing and services, to help potential customers (while interacting with retail team) differentiate product from competition in a wholesome manner.
g. OEMs should develop mobile retail sales trainers for their retail team to regularly impart training sessions and audits at dealerships,
h. When the development of the retail Infrastructure is customer-oriented, the results will be phenomenal.
i. OEMs should modify the dealership performance appraisal sheet by giving considerable weightage to retail numbers and also related activities. In recent communications by OEMs, we have observed the importance being given to retail numbers, where OEMs like MG Motors have started sharing the retail numbers against other OEMs’ wholesale numbers.
| Manufacturer | Mar’21 (W/S) |
Feb’21 (W/S) |
Mar’20 (W/S) |
M.S. Mar’21 |
M.S. Mar’20 |
Vs LM | Vs LY |
| Maruti | 146,200 | 144,761 | 76,240 | 45.6% | 54.2% | 1% | 92% |
| Hyundai | 52,600 | 51,600 | 26,300 | 16.4% | 18.7% | 2% | 100% |
| Tata | 29,655 | 27,224 | 5,676 | 9.3% | 4.0% | 9% | 422% |
| Kia | 19,100 | 16,702 | 8,583 | 6.0% | 6.1% | 14% | 123% |
| Mahindra | 16,700 | 15,380 | 3,171 | 5.2% | 2.3% | 9% | 427% |
| Toyota | 14,997 | 14,069 | 7,023 | 4.7% | 5.0% | 7% | 114% |
| Renault | 12,356 | 11,043 | 3,269 | 3.9% | 2.3% | 12% | 278% |
| Ford | 7,746 | 5,775 | 3,519 | 2.4% | 2.5% | 34% | 120% |
| Honda | 7,103 | 9,324 | 3,697 | 2.2% | 2.6% | -24% | 92% |
| MG(Retail) | 5,528 | 4,329 | 1,518 | 1.7% | 1.1% | 28% | 264% |
| Nissan | 4,012 | 4,244 | 825 | 1.3% | 0.6% | -5% | 386% |
| Volkswagen | 2,025 | 2,186 | 131 | 0.6% | 0.1% | -7% | 1446% |
| Fiat | 1,350 | 1,103 | 163 | 0.4% | 0.1% | 22% | 728% |
| Skoda | 1,159 | 853 | 451 | 0.4% | 0.3% | 36% | 157% |
| Total | 320,531 | 308,593 | 140,566 | 100% | 100% | 4% | 128% |
In the current decade of intense competition from connected technologies, new entrants, changing customer behaviour, aspirations etc, the dealer retail team has to be the epicentre of innovation and practices and then the dealerships and OEMs’ probability will take care of itself.
Disclaimer:
(The author is Manager – New Product (Institutional and Government Sales) Sales & Marketing, Tirth Agro Technology Pvt Ltd, ‘SHAKTIMAN’. Views expressed are his own.)
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