Log In

NADA Q&A with Josh Dougherty

Mar 01, 2018

As we gear up for NADA Show 2018 coming up March 22-25 in Las Vegas, we checked in with Vice President of Sales Josh Dougherty for his thoughts on what attendees will be looking for this year.

Q: What do you think will be the hot topics at NADA this year?
A: Margin compression will definitely be on many dealers' minds. We enjoyed a long period of strong sales for new and used cars, and there's optimism for 2018 even though January and February sales were a little soft. However, tighter per-unit margins and reduced demand mean that many dealers will have to work harder just to maintain the status quo.

Another big theme will be tracking ROI and attribution of advertising and software spend. Tracking dealer spending has been a real shoot-from-the-hip endeavor in the past. Now there are new products and services that track spending more wisely and provide data to help dealers be more strategic with their spending. A clear example of this has been the massive shift by dealers away from AutoTrader.com due to the lack of true sales attribution. Instead, dealers are seeing much stronger results from third-party sites like CarGurus, and increasing their spend with them accordingly.

Dealers must also keep a watchful eye on every software subscription service they're paying for.

The average dealer now pays around $2,500/mo. for their used-car booking and inventory- management tool, and another $1,000/mo. for new cars. Alternative services with superior technology and data can be had for a third of that price, shaving around $30K per year off the dealerships bottom line.

Q: What are some areas where dealers can improve?
Definitely new-car aging. Every day a new car sits on your lot, it's depreciating and costing you $20-$30 in holding costs. Dealers should focus on doubling their new-car turns. Twice as many turns means twice as many opportunities for trade-ins, F&I, factory cash and future service customers. Successful dealers do this by leveraging tools and data to drive their retail-pricing strategy for new cars.

Q: How can technology help dealers?
Dealers want more data to make better decisions, but at a reasonable cost. They're looking for companies they can truly partner with, in an effort to move away from giant multi-brand conglomerates like Cox Automotive that only care about upselling and increasing the bill.

Digital retailing continues to be an area of interest. When done right, it can improve visibility and increase sales. Dealers want to know if they have the right tools to succeed, and NADA is a good place to learn about what's available.

There have been a lot of mergers and acquisitions in the auto-software space, which can lead to less competition and higher prices. Dealers should look for smaller, more nimble companies like DealersLink that offer a stronger ROI and will be better partners for their business.

Q: What advice do you have for dealers right now?
A: Get your operational house in order and improve efficiency. Stop overpaying for software services and advertising. Start operating with an Amazon-like mindset that focuses on transparency and an excellent customer experience. You're not just competing with the dealership across town anymore, you're competing with car-selling websites and dealers across your region.

Stop by and see me at booth 337N to talk more about 2018 and learn how DealersLink can help you save tens of thousands of dollars per year off your current new- and used-car appraisal and pricing tools!

See you at NADA!