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What's in a name?

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#2
Cullen C said:
Why does Asbury think that adding regionally branded names to the Q auto platform is the answer? Knowing today's shopping process how important is the dealership name anyway?

http://www.autonews.com/article/201.../asburys-q-auto-store-tries-brand-recognition
Click to expand...

Cullen,

It just so happens that comparing Carvana to Qauto makes an interesting strategic discussion.

Here's my $0.02

If I were to deconstruct the PR, Q Auto's actions speak to it's problems. Asbury's leadership has come to the conclusion that re-naming one store to an existing brand will be a test to see why Qauto UVP is under-performing. From my seat, Qauto's UVP* is all about profiting from the "anti-dealer" sentiment, so, renaming itself to a known dealer will be a bandaid to a larger problem... and that problem is... the UVP was born from lab research and it lacks a WIFM** that resonates with shoppers https://www.qauto.com/why-q.htm.

Qauto's UVP framework and business shortcomings reminds me of Sonic's EchoPark experiment. Both are struggling to understand why shoppers are not flocking to the "anti-dealer" concept. I haven't looked, but my instincts are telling me that this is Ashbury's 1st attempt to sell as an independent (as it is Sonic's EchoPark too).



p.s. I spent a decade as the marketing director for one of NY's most successful independent dealers (3 stores, 6k sales p/yr). Carvana was born from the leadership & culture that ran successful independent dealers. I think we see the world differently ;-)

*UVP = Unique Value Proposition
**WIFM = What's In It For Me
 
#3
Part 2: A study in Disruption. Carvana vs Sonic & Asbury.

I've studied Carvana in great detail. Carvana represents real disruption, where Q Auto and EchoPark are small variations of existing dealerships.

Carvana's success does not come from low prices, because Carvana prices are not low (I've looked ;-). Your success comes from a wild ass website UX that sets up your wild ass UVP message. Also, I deduce that you must have a world class phone team that does all the selling (e.g. calming fears). Carvana also enjoys a far lower cost structure that allows you to reach profitability on far fewer units. This magical equation allows you to easily expand into new markets while your UVP is constantly improving (e.g. closing rate).

Fast fwd 5 years...

While Carvana is expanding it's footprint and dialing in it's UVP, the Internet car shopper will be maturing and so will the concept of "buying a car online". On top of that growth, repeat and referral sales are increasing. Result? Carvana sales rise and costs remain well below franchised dealers.

Carvana's challenge will come from new competitors copying the model. When you give it some thought, the outcome of this competition won't come out of Carvana's hide, it'll come right out of the franchised car dealer who operates with a far higher overhead.
 
#4
JoePistell said:
Cullen,

It just so happens that comparing Carvana to Qauto makes an interesting strategic discussion.

Here's my $0.02

If I were to deconstruct the PR, Q Auto's actions speak to it's problems. Asbury's leadership has come to the conclusion that re-naming one store to an existing brand will be a test to see why Qauto UVP is under-performing. From my seat, Qauto's UVP* is all about profiting from the "anti-dealer" sentiment, so, renaming itself to a known dealer will be a bandaid to a larger problem... and that problem is... the UVP was born from lab research and it lacks a WIFM** that resonates with shoppers https://www.qauto.com/why-q.htm.

Qauto's UVP framework and business shortcomings reminds me of Sonic's EchoPark experiment. Both are struggling to understand why shoppers are not flocking to the "anti-dealer" concept. I haven't looked, but my instincts are telling me that this is Ashbury's 1st attempt to sell as an independent (as it is Sonic's EchoPark too).



p.s. I spent a decade as the marketing director for one of NY's most successful independent dealers (3 stores, 6k sales p/yr). Carvana was born from the leadership & culture that ran successful independent dealers. I think we see the world differently ;-)

*UVP = Unique Value Proposition
**WIFM = What's In It For Me
Click to expand...

Joe, thanks for the thoughts and compliments about the company, I did not anticipate the immediate model comparison so I will recuse myself from the thread if others would like to carry it further.

I was interested in the community's thoughts about Asbury's motivation to begin using a known dealership name. I tend to agree with you that they are not doing it because they are experiencing wild success.

It seems strange to me that while this may provide a very brief, local lift to sales it actually aligns the brand with what they are supposedly attempting to separate themselves from.

This recent decision has validated my overall belief in why they may be struggling. They have not truly embraced what it takes to have a different dealer experience. You actually have to be different. Similar to what everyone should have learned from AutoNation's failed used car only attempt in the 90s. You cannot take existing dealership personnel and reallocate them to what is supposed to be a completely different experience.

And just to paint a clearer picture its actually not the first attempt by them to jump into the independent used car game:

http://webcache.googleusercontent.c....com/money/retail/2002-04-23-walmart-cars.htm
 
#8
Chris Leslie said:
Hmm, Wouldn't it make more sense to hire a better agency, growth hacker or something?
Click to expand...

It's possible that those 3rd party opinions are what got them into this problem ;-). Everyone sees the same surveys. It's why eCommerce has been funded but fails. Evidence of this is seen in EchoPark's PRs too. It's what @ruggles has been preaching (I'll paraphrase) "surveys ain't shit if you don't know your customer and our marketplace".

Compare and contrast to Carvana.
Why is Carvana's model expanding into new territories (vs Q auto & Echo Park)? Carvana's solution presents a completely new vision that is deeply comprehensive and potentially disruptive. Carvana is 'all in' (e.g. 7 figure photo booth, branded delivery experience, zero showroom, etc).

Our industry is always evolving, we all learn from wins and the fails!
 
#9
JoePistell said:
Chris,

Qauto leadership feels it's financial performance problem is due to it's unknown name. By renaming it to a 'known name', they are hoping to tell if Q auto's problem is the name & not the Q auto biz model.
Click to expand...

I do not know the specific value props of the Q model well enough to give a definitive opinion on where the deficiencies might be. The decision to change the name feels short sighted. Even if it works short term, what do you do then? Do you continue to add regional names throughout the country? Eventually the regional names are only that, regional. If the long term plan is to be a national player you have to trust your research and continue to iterate. Building a brand name from scratch is tough and expensive and time consuming. There are no short cuts. Adding regional names feels like a short cut to me.
 
#10
I agree Cullen.

I think the title of the article is example enough.. "Asbury's Q auto store tries brand recognition"

How do you "TRY" brand recognition?

Along with this statement:

"We want to hold them out, to see what kind of reaction we get in the Jacksonville market where we go with the tag line versus the other two stores where we don't,"

Sounds to me like these guys need a couple of Sherpas.
 
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