The Auto Auction Industry has managed to cling to its traditional business model much longer than most other automotive segments. For instance, when 90% of retail car buyers started doing their research online, franchise dealerships quickly realized the tremendous impact of the Internet on the their brick and mortar operation. Dealerships had to redesign their entire sales process, which had become irrelevant in the wake of new technology that allowed customers to locate, valuate, customize, and comparison shop within their own geographical specifications. The customers had become more educated, and had the power to filter. For dealerships it was adapt, or face disruption.

So is it unreasonable to believe that dealers, who are now completely immersed in the digital playing field, are not going to expect the same level of expediency from the Auto Auctions? Sure, there are still a lot of traditional Used Car Managers who love the nostalgia of the lane-buying experience, and are steadfast in their belief that you have to touch the car, but what about their successors? The ones who are being nurtured in the speed of electronic business – a complete contrast to the physical auction process. As it stands, there are many dealers who physically attend the sale, but conduct their research online prior to attending. Is it really hard to fathom that there will come a time when the online disclosure becomes sufficient for making the ultimate decision to purchase? How much will the role of the buyer change as more apps are infused with UCM mentality, or are even more precise in their ability to ‘buy right’? Have you seen Accu-Trade?

As the number of dealers wishing to buy online increases, the more feedback we are seeing with regard to the frustrations associated with the process… some of which could be alleviated through operational changes. So why do auctions still insist on “doing things the way they’ve always been done”? Well, many fear that change may upset their lane customers as well as their staff, and there are simply not enough online customers to justify self-disruption. Or are there? The revolving door of online attendance demonstrates that auctions receive plenty of interest from potential customers, but are they doing enough to captivate this audience? Lane dealers are called and visited weekly by auction reps. They are continually introduced to buying incentives. Meanwhile, many online dealers have the perception that their virtual attendance is less appreciated, and most auctions tend to unintentionally substantiate this belief. What is important to understand is that disruption is typically triggered by the silent, mistreated, majority. Those who truly want a better way will ultimately build one.

So how can auto auctions insure future online success without completely shaking up the operation?

Simply put… it takes leadership. Everyone in the organization should support the effort to evolve, and the plan should clearly illustrate the areas in which optimization will improve the workflow for both staff, and dealers. If it’s not within the auction’s capacity to architect a business model that embraces online business development, then I would recommend hiring an outside consultant, or simply joining AuctionVcommerce for a ‘business-in-a-box’ solution. The bottom line is this… the industry is moving forward with technology. Auctions that choose to stay where they are, will undoubtedly be left behind. The iceberg is right ahead.

“If you can’t fly then run, if you can’t run then walk, if you can’t walk then crawl, but whatever you do you have to keep moving forward.” – Martin Luther King, Jr.

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