"Changing the basic retail tire buying experience" is the hot topic right now. It’s been the underlying thread of every dealer meeting I’ve attended over the past year, and it will doubtlessly be the theme of many more in the near future.
And it should.
Between 1997 and 1999, tire retail customer satisfaction, measured by J.D. Power & Associates, dropped 16 points. Because 1997 was indexed at 100, those 16 points were in addition to whatever dissatisfaction already existed. Any way you cut it, that’s a lot of not happy people.
J.D. Power asks recent tire buyers to grade their retailer on the basis of people, service, facility, reputation and product selection. (Notice "price" isn’t on this list.) No doubt this is a superficial study, focussing on the "what" and not on the underlying "why." It is what it is, so I’m not going to waste space, as others have, picking it apart.
Regardless of depth, where there’s smoke, there’s fire.
Everyone has a theory as to why tire consumer dissatisfaction is growing, but each follows the same general path: Consumers or retailers lack time, convenience, trust, control, confidence, information, understanding, products, patience, differentiation.
One is clearly a delivery issue – what retailers bring to the process. The other is one of acceptance of what’s being delivered – especially in these days of high consumer discomfort with the entire tire industry.
Which brings us back to the issue of "changing the basic tire buying experience."
The pick-it-and-park-it tire-buying experience hasn’t changed in a century. Neither has the entire system of getting tires from the assembly line to the axle, a system developed for the convenience of the players, not the payers.
I agree with Michelin North America Chairman and President Jim Micali’s assertion that the company – and you can include tire dealers in this – that finds a way to enhance or even change the basic tire-buying experience will win and hold the hearts of consumers.
The question is how?
After all, you’ve got a few vital assets bolted to the floor. You can’t exactly make house calls.
You’ve got a fixed number of bays and bodies, overhead you’ve got to keep churning. You can’t change your scheduling.
You have only so much space to house tires, and an ever-growing mass of SKUs to deal with. You can’t make tires appear out of thin air.
There are only so many hours in the day, and only so much money to devote to the look and feel of your location. You can’t turn a tire shop into a crystal palace.
Or can you?
The point is: What do you really know about your customers’ expectations? What do they really want? And why?
And I’m not talking about things like "lower prices." Everyone wants that. You do too, whenever you’re shopping. Frankly, I’m tired of the price arguments. If the only way you think you can sell tires is by having the "lowest prices in town," there’s nothing I or anyone else can do for you in these pages. Please close this magazine and toss it away.
If you’re still reading, I’m talking about deeper issues. Why do certain types of customers – age, gender, marital status, etc. – do business with you, and others don’t, won’t or can’t? Why do they like or dislike aspects of your business? What do they value, and how do they define "value"? Why do some react to certain inputs – comparative data, look or design, cost/value – and others don’t? What don’t they know or understand about you and your business?
Some of the answers will be obvious. Others are going to take deeper digging. A guy I used to work for told me the only way to find out the real reason why things are is to keep asking "Why?" He’s right.
One industry "seer" says the days of the one/two location dealer are numbered. Distribution consolidation and/or competitive pressures will either suck them up or put them out, he predicts. Consumers will be left with faceless big boxers and territorial mega-dealers, like the hardware and pharmacy markets.
I don’t buy it. I don’t think the days of the smaller dealer have passed. But it’s not up to me.
The market’s unit requirements and necessary delivery points won’t change much.
So the only variables are what you really know about your customers, and how willing you are to change their basic tire buying experiences.