• by Karl Greenberg , January 27, 2014

The president of J.D. Power and Associates, Finbarr O'Neill, knows a thing or two about dealership relations. When he went from Hyundai corporate counsel to CEO of Hyundai Motor America early in the Millennium, he ended up a key player in the brand's turnaround in the U.S., starting it on a path that took it from mocked to marveled at. 

O’Neill also had a reputation as a listener when it came to dealer concerns, which probably helped him get the top job at dealership management services company Reynolds & Reynolds. So it’s apt that he should have something to say about the retail end of the car business -- especially at the National Automobile Dealers Association conference in New Orleans. 

He tells Marketing Daily that despite having had a great 2013, dealers face challenges. And while one could hear "digital, digital, digital" up and down the conventional center's halls, O'Neill says a real issue is not high-tech: the relationship between the automaker and the dealership is the ultimate determinant of success. If it's good, dealers are happy and profitable. If it's contentious and wanting in terms of dialogue and common cause, they are unhappy, and probably unprofitable.   

"There are some franchises whose mission it is to help not just the ultimate buyer, but also their customer. The dealers are doing things like engaging in initiatives that are focused on dealer profitability,” he says. “They do much better and you can see that in the NADA dealer attitude survey. Those franchises tend to be valued more by dealers." 

One example of this might be Ford's Customer Experience Movement program. That program essentially brings the equivalent of life coaches to participating dealerships to help them fix their intramural relationships, clarify the vision of the store and its employees, and ultimately, improve morale. The automaker is ramping up the program worldwide, per Elena Ford, who last year became VP of Ford's new Global Dealer and Consumer Experience organization. She tells Marketing Daily that the company's participating dealers report much higher retention rates and that the program works in every market in the world, regardless of culture, because "dealers are all interested in being profitable." 

Says O'Neill: "You have to have good people at the dealership with a customer orientation and appropriate process. If that works, and you have a facility that is engaging and comfortable, you win." 

At the J.D. Power conference a day before NADA started, BMW's head of North America, Ludwig Willisch announced that company's plan to do something of a dealership makeover, comprising dealership aesthetics and sales staff training around new technology and how to engage with younger consumers. 

The German automaker's program would probably pass muster with O'Neill, who said a facelift won't work, no matter how much you spend. "One of the major domestic brands was asking if they should spend $8 million to effectively make Taj Mahals. But that doesn't help because it doesn't change the people and how they treat customers. You have to be careful not to go overboard on facilities. You have to look at it holistically."