I recently read an article by the BBC’s long-standing global business correspondent Peter Day. Entitled The World Turned Upside Down, it elucidates Day’s reflections based on conversations he has had with leading business thinkers over the last 10 years.
Its central thesis is that we are at the start of a post-industrial revolution – an era in which the business winners will be those that can precisely meet the needs of many small groups of like-minded individuals – an era of Mass Customisation.
He contrasts the newly emerging era with the industrial revolution and specifically the founder of Ford Motor Company, Henry Ford, who pioneered efficient mass production and mass distribution. To be a successful company then you needed to sell your products to the maximum number of people wherever they were in your home market and around the globe.
The techniques of mass production and mass marketing pioneered by Henry Ford are still being played out by big business today. But the nature of manufacturing, in the developed world at least, is changing now that manufacturers have worked out that no matter how much they improve production methods; build standardised parts; and cut prices through the supply chain; they can never compete on price with the developing world economies.
So what is the future of making things in the UK and the rest of the developed world I hear you ask? The answer appears to lie in focusing on creating systems, machines and services to help us customise products cost-effectively; work more collaboratively to innovate – globally if necessary; and of course listen to customers more keenly to ensure that we deliver exactly what they want, when they want it. The final key ingredient is high quality. We must achieve that to differentiate ourselves from the new mass producers. If you delve into the world of manufacturing and industrial automation today, much of the focus is on building production line machines which are capable of rapid retooling and reconfiguring so that products, including cars, can be ‘mass customised’.
Day also uncovers why firms like Google have become the business megastars of the age while many dotcoms went by the board. Google sees the world as all businesses need to see us - the consumer - as individuals or at least small groups of individuals. As one Silicon Valley-based dotcom pioneer Joe Kraus said to Peter Day: "The 20th Century was about dozens of markets of millions of consumers. The 21st Century is about millions of markets of dozens of consumers."
So how do we take the lessons learnt in custom manufacturing and by Google, into a service-led world of car dealerships? Start by thoroughly understanding your customer-base. What is their new and used car history and aftersales buying history and what are they not buying from you? Work out why they are not buying. Use everything at your disposal to gather this intelligence – online surveys, questionnaires completed in the dealership or from home.
Once this has been completed and analysed, begin to segment your customers into meaningful groups. One group might be ‘first time car buyer prospects’, another ‘loyal used car buyer who does not currently buy servicing from us’ etc.
Once this work has been done you can begin to analyse how they would like to be communicated with. Are they interested to know more about the latest offers on regular servicing or financing options, for example? Tailor the communications specifically to these pools of customers. Don’t be afraid to get to know them much more than you do today.
What about extending that customisation into how you communicate with your customers? Allow them to configure the way they engage with you. Vehicles are already highly configurable, but are your aftersales services equally so? Are your servicing and finance products available for consideration and purchase online? Are they supported with an online chat facility? Can you take service bookings online around the clock? If not, why not?
Even Peter Day is unsure how the new era of mass customisation will pan out for a service-led economies. But surely if we continue to strive to get closer to our customers; tailor our offerings to more accurately meet their needs and treat them more as individuals; UK dealers can begin delivering the service equivalent of mass customisation?