Relentless Forward Motion

NADA 2024 once again showcased the best of the industry and offered valuable insight into where we are, and more importantly, where we are going.

Much, as always, remains the same in automotive and while there will always be advancements in the core business of OEM and dealerships, a little like model upgrades, they are variations on a theme rather than genuine innovations.

However, that's no bad thing. It's reassuring that, at heart, good businesses can thrive on the same principles as before and the 'great disruption' is not yet upon us.

That's not to say there was nothing to get excited about - far from it!

New trends were definitely present at the show and I thought I'd highlight a few of them below.

1. DATA & TECHNOLOGY

The number of specialist system suppliers has grown significantly in the last few years, often accelerating from start-up to enterprise in next to no time. They are the high-growth sector of the wider industry.

In my opinion, most of these businesses share a common foundation (data) and a common purpose (improving customer experience).

This, for me, is the key industry theme over the next five years. The gathering, storage, handling, sharing, presentation, and usage of data is the number one topic in automotive (if my experience of NADA is anything to go by).

We know customers are receiving intuitive, rich in-store and digital experiences in other industries and, if we're honest with ourselves, automotive has fallen behind.

I was excited to see so many technology businesses represented at the show, each engaged in creating that forward momentum to allow the car buying and servicing experience to play catch up.

This is great news for those prepared to embrace the power of change and a reminder that the first-party data of your business (your customers and prospects) is valuable now, but will be absolutely crucial in the future.

Data will power the next phase of industry growth.

2. CHAT & PREDICTIVE COMMUNICATION

Together, these items can be summarised as "getting close to your customer" - an age-old adage but one that is changing as technology influences both the customer's experience and actions and our abilities to match them.

Chat for vehicle sales and servicing is an obvious sector entering its second phase of growth. The smarts behind automated bot conversations are improving, so what was overly complicated and complex to manage for an SME before, will become easier in the future.

This is partly enabled by predictive communication. If you've used Chat GPT or seen Gmail offering you sentence completion, you'll know how this works. The text in a source is recognised and an automated response is suggested or triggered.

The problem has always been that the automated response sounds exactly like it is - automated. Nothing will distance your customers more than impersonal communication, so that was never going to work.

However, I think we're finding the middle ground - predictive text is improving all the time and there is now a seamless layer for human amendment or confirmation before sending.

I think that works. It changes the automation from customer engagement to a productivity tool, doing much of the legwork without losing the authenticity of the human touch.

That's a good place to land and I expect chat and predictive communications to be a growing part of customer engagement for all sizes of business going forward.

3. "AI" - a buzzword that needs some investigation

It was no surprise really, AI was everywhere at NADA... but was it really?

A lot like "we're cloud-based" a few years ago, you only need to scratch the surface before you realise that much of the hyped claims are just that - hype.

True, many of the parties claiming "AI" have great products and very complex algorithms but that is not Artificial Intelligence, it's just piggybacking on a zeitgeist and you should be prepared to drill down into some of these claims if you come across them.

The key difference between AI and an algorithm is that AI "learns" and an algorithm just "processes" - AI interacts with data and an algorithm simply follows the rules.

But, if many of the claimed AI products available today are just great algorithms does it really matter?

No, it doesn't if the software ultimately does a good job for a business. It's a personal bug-bear and being in technology I might be a bit more sensitive to making sure that claims aren't exaggerated in our industry.

The language of technology can be very confusing, particularly for those who rely on it to run their business but don't claim to understand it (nor should they have to).

I think the technology industry has a responsibility to be a little more transparent around this and not exploit a lack of understanding as a sales tool.

So, if you're considering software with a claim of being "AI", just dig a little deeper to make sure you're getting exactly what's on the box.

I don't want to finish on a sour note! So I'll mention again that I had a great time at the show and thought it was a huge success with many great learnings. Las Vegas is the city that never sleeps and NADA proved the automotive industry doesn't get much rest either.

It was refreshing to meet so many old faces and discuss many of the familiar challenges and opportunities facing the industry. It was also invigorating to see some real innovation and energy coming through for the future.

An all-around great event. I'm already looking forward to the next one!