Latest / Auto Collabs / Retention, Defection and Conquest with Greg Uland

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Retention, Defection and Conquest with Greg Uland · Auto Collabs

• 0:00
  Kyle, I'm starting to feel like I really miss Michael. [upbeat music] This is Auto Collabs. I, I'm, it's, it's a little sad to me, you know? I mean, I know he's coming home.
• 0:18
  Like- He'll be here soon. There's a whole reason why it's called Auto Collabs. I know, you and I- 'Cause it's a collab- You and I do this all the time- With all three of us...
• 0:24
  on a bunch of other stuff, but Michael- I know... I mean, like, who's gonna make dumb jokes at the right moment? Who's gonna ask deep questions at the right moment? Who's- It's not you or me...
• 0:31
  who's gonna be short at all the moments, you know? [laughs] That's, that's really what I'm wondering out here. Nailed it. There you go. Nailed it. That's what, that's what you get, Cirillo.
• 0:41
  [laughs] We're gonna cut this out, tag you in a social post, and then you're gonna find out, and not be surprised what goes on when you're not around. Got it.
• 0:47
  But, uh, today, I'm excited for our guest today because- Always... K- I, can we call him an old friend? He's younger than me maybe. Yeah. Um, but now I, I start to feel like Greg Uland with Reynolds- [laughs]...
• 0:57
  is like, we got a, we got a, we got an energy going now. So now when- Absolutely... he shows up, we don't have to do all the pleasantries. We can get right to business. Get right to business. He's a co-content creator.
• 1:06
  He is diligent with the way that he works within the Reynolds organization and understands everything that that organization has the capacity for, the data around it- Mm-hmm... um, you know, the product sets.
• 1:20
  Like, he's not just... I don't, I wouldn't... He's, I think he's the vice president of marketing. He's not just a marketer. He is like- No...
• 1:26
  a through and through participant in the operations of the business, so I always- That's, that, that makes the best marketers... love having this conversation. Absolutely. Right? They understand- Yep...
• 1:33
  operations and they have, they have, um, like you, you say it, marketing is like the heart of the business. Like, whatever it is. Yep.
• 1:41
  You say it more eloquently, but that's like, they have to be connected to all the different extremities of the business, and Reynolds has a couple different extreme- I mean, like, we're not just talking about arms and legs.
• 1:51
  Like, this is like a centipede. Right. Right? Yes. They're in every- They're printing check- Like, there's all the things he talks about last time. Right.
• 1:57
  Either way, we hope you enjoy, uh, this next chapter of our conversations with Greg Uland. [upbeat music] [laughs] Hey, we're already ha- laughing here, uh, with Greg over at Reynolds.
• 2:11
  And, uh, y- man, it's just always a pleasure to hang out with you. You've always got insights and laughs and, and goofy things to chat with us. So, uh- [laughs]... welcome to another episode of Auto Collabs, man.
• 2:21
  Appreciate it. Appreciate it. I hope it's not too goofy today. [laughs] Oh, I'm- Well-... I'm, I'm all in on the goofy, but we're gonna get right down to it- [laughs]...
• 2:28
  because, uh, you know, a lot of times on Auto Collabs, we, we go through a little bit of story, and we've heard your story before. Actually, this is random. My father-in-law is actually here right now.
• 2:39
  In the '90s, my father-in-law with it, was the agency of record for Reynolds. Really? No way. Yeah.
• 2:48
  Um, so yeah, he, he has an agency out of, uh, out of Cincinnati a- and was, like, the agency of record for all of Reynolds. Hang on. When, so when was that? Like, what part in the '90s?
• 2:59
  Uh, like mid to late '90s it would've been. So- Um- Oh, man. S- Awesome... I think the company was named Sunrise at that point. Okay. Um, I don't know if you...
• 3:09
  I can't remember when you started, but- I started in, uh- Yeah, you did... yeah, '08 I started. Um- Yep... but- Yeah, so it was, it was right, uh...
• 3:19
  Yeah, so it would've been, he was like, it was like '95 to '98 or '99 or something like that. Uh, so, and, and I don't know, like, exactly what the outputs were, but yeah. So- That's awesome...
• 3:28
  I had no clue that I had that much, like, family history in- [laughs]... uh, with Reynolds. So. So '99 was actually, you know, last year at NADA, so not 24, but 23 at NADA.
• 3:39
  Um, you know, we launched our, our new logo and kind of, you know, got on this, this track that we're on right now and, um, went through a lot of history with the company leading up to that.
• 3:47
  And '99 was the, the time prior to last year that, that we had kind of created a new logo. And, uh, so I wonder if there was some transition there where- Ah... where your father-in-law...
• 3:58
  Like, we were like, I, I probably have stuff in my office here with examples of, you know, how we launched.
• 4:04
  It was when we launched our first website, and it was when we had a new logo, and so there's a lot of, lot of stuff.
• 4:08
  So there might be some, uh, some meat that we can at least get you- He's literally right outside this door right now. [laughs] We could go grab him.
• 4:14
  He's gonna- We'll talk through the whole history of Reynolds real quick. He's watching Harry Potter with my- Oh, that's amazing. [laughs] That's amazing. That's fine. I can watch it. No, we can't do that.
• 4:23
  We have, we have a report- We can't do that. We gotta get to it... to talk about. We have data to talk about. We have dealers to help out. Um- That's right...
• 4:30
  like this, this study that, you know, I'm looking over some bullet points, and Kyle and I were reviewing it. Um, it seems like some very actionable information for dealers to take, especially as it pertains to conquest.
• 4:41
  Everyone's trying to figure out where they're gonna get this. Like, we're back to playing the ground game as an industry, right? There's no more, there's no more it's gonna come in, and everybody knows that.
• 4:50
  We've been talking about it for the best, better part of nine months now.
• 4:52
  So why don't you walk us through a little bit about what this data is and, like, how it can really inform some dealers' decisions, specifically around conquest. Yeah.
• 5:00
  So we've been doing this for quite a few years now, but, um, basically we look at, over the calendar year, uh, every trade-in across the US. So it's transactional data, uh, DMS data.
• 5:09
  So every, every trade-in across, uh, the US, and then what vehicle was purchased on that trade-in. Um, so it's a pretty broad set of data. But, uh, there, there's some really interesting things.
• 5:18
  It seems that always stand out in every report that's similar to this has, you know, kind of similar numbers, but I love that this is true transactional data, so you can really dig into it, and you can look at it by geography, and there's all kinds of, uh, nuance to it.
• 5:29
  But, um, so retention across the US across all brands is, uh, is a staggering 40, 43.7%. So i- it's, it's crazy how six out of 10 people aren't gonna drive the same make of vehicle that they're in today. Um- Wow...
• 5:43
  you know, and, and that's something that the dealership can't control, right? The retailer, that, that's not, the, the retailer isn't, isn't convincing someone to drive a Ford or drive a Chevy or drive a Honda, right?
• 5:53
  They're convincing them to, to buy from them. So, uh, the, the cards are kind of stacked, stacked against us in a lot of ways, um, just because there's- Yeah, and I mean-... a lot of brand loyalty... that's brand loyal.
• 6:03
  That's not dealer loyal. Right. So you probably see even a lo- Mm-hmm... and, and it could be brand loyal to used, brand loyal to new. Uh, so that's, like, overall brand-to-brand loyalty, right? Yep. Yep. Exactly.Yeah.
• 6:16
  So that's, that's a wild thing. Actually, there was a lot of conversation as we went through COVID about declining loyalty, right? Mm.
• 6:25
  So l- looking at, you know, it looks like actually loyalty, I think, over the last year has come up a couple percentages. Yeah.
• 6:31
  So that's a change, um, you know, from, from the middle of the pandemic when it was basically buy whatever inventory's available.
• 6:37
  So we're seeing loyalty return a little bit, um, which is a, you know, an interesting pattern to pay attention to.
• 6:44
  Uh, but it's still, you know, when you look at, like, hey, 40-- only four out of 10 people are actually buying the same brand.
• 6:51
  It takes a lot of work when that's not even dealer loyal to figure out how to keep, especially for new franchises, keep people in, in the brand, which is, I think, like, it's a, it's a massive opportunity for dealers to figure out how to leverage marketing to, to move people back into their brand and not just the brand, but to the dealership.
• 7:11
  Right. Right. And I think it, it, it lends itself also when you think about even after sales, right? A-and you think about where that relationship lies. Because at the end of the day- Yeah...
• 7:18
  brand retention is really gonna be about your experience with the car, right? You, you buy it initially. You buy it initially 'cause it, it, it speaks to you a little bit, right?
• 7:27
  For some reason or another, you wanna be in that car. Uh, it's, it's in a lot of ways a reflection of who you are.
• 7:33
  Um, but then over the next two, three, five, six years, whatever it is that you own that car, you're gonna, you're gonna experience it, right?
• 7:39
  And, and the way that you experience that car is gonna determine whether or not you come back and buy that same car again or that same make again. Um, and that's where you're gonna have more touch points as a dealer.
• 7:48
  Again, you're not gonna completely influence whether or not they're gonna buy another Toyota. Mm-hmm. But, um, you can certainly have some level of impact in that after sales experience.
• 7:56
  You know, we focus a lot on the sales experience, which is great, and we should.
• 7:59
  Um, but we also need to focus on that, that ownership experience, the full ownership experience, and not just the transactions and the touch points that we get, you know, every year in the dealership.
• 8:09
  You know, you mentioned ownership experience. One of the data points in the report, uh, basically the note is that premium brands are conquesting Ford and Toyota drivers at surprisingly high rates. Yeah. Right?
• 8:22
  When I think ownership experience, and you think of- Yeah... premium brands, you think, like, that's what they zero in on more than anything else. Yeah. Yeah, when you look at those, you know, you think a premium brand.
• 8:32
  And we kind of break it out into different segments in premium even. But, um, when you look at those, you would think, all right, they're probably conquesting a majority of customers from other premium brands, right?
• 8:41
  There's- Right, each other. Yep. Yeah, you know, Mercedes and BMW- Yeah... and, like, they, they should be conquesting from each other.
• 8:46
  But when you, when you really break it down and kind of go brand by brand, um, yeah, Ford, Ford and GM are... And, and part of it's market share, right?
• 8:55
  They're, they, they're large market share players, so there's more opportunities out there. But, um, they're not bouncing... Buy-buyers aren't bouncing so much between the exact same segment.
• 9:04
  A lot are, are actually pulling up into those premium segments. Hmm. So I'm looking at some of the other points. Truck owners, uh, it s- seems like they're, uh, still being truck owners.
• 9:17
  72.5% likelihood of purchasing another truck. Yeah, so that one's interesting, um, because it's a unique segment, right? Trucks. If you buy a truck- Very much... you have a reason to buy a truck, right?
• 9:26
  And you're prob- Absolutely... you're probably gonna buy another truck.
• 9:29
  Um, but what's, what was the most interesting to me, and, and it kinda has been doing this for the last couple years but it's accelerated this year, is the actual brand loyalty inside of those truck buyers, inside of that truck segment, has gone down pretty dramatically.
• 9:42
  So GM trucks are the only brand that keep over 50% of their drivers. So even, you know, the, the dominant Ford, right? If you're in a- Wow, that's really interesting. Yeah. GM. GMC. Yep.
• 9:54
  Yeah, because Ford historically, like, you think about just extreme loyalty, but there's clearly pressure in the market from other brands changing the way that the loyalty happens.
• 10:06
  Obviously, there's a lot of hom-homogeny across trucks, I feel. Yep. Uh, and so, you know, you, you get that change. That's a, such a dramatic stat in my poin- op-opinion when you've got 72%
• 10:20
  l-likely to purchase another truck, but the likelihood of them not purchasing another truck from you is, like, lower as a delta.
• 10:28
  Um, I feel like that's, like, especially for a domestic dealer to really zero in on that segment and figure out how to retain that customer is probably a high likelihood if you're, if the communication pattern, if the after-sales pr- pattern is really strong, right?
• 10:46
  Yeah. Yeah. So how do you retain that customer? But, so Ford as an example, right? So 40... Let me look at it so I don't get it wrong. 47% is Ford's retention number.
• 10:55
  So if you're, if you're in a Ford truck, right, F-150 or a Ranger, it's, it's grouped together. So a Ford truck. If you're in a Ford truck, uh, 47% of the people that trade those in are gonna buy another Ford truck.
• 11:05
  So you look at that and you go, "Okay, if I'm a Ford dealer, it might be a good idea to not be scared of selling some Chevy trucks," right? Like, somebody's... They're gonna buy a truck. Um- Right...
• 11:15
  so how do I stock- Right... appropriately to make sure that I keep that customer? Forget about the vehicle for a second. Like, how do I keep the customer? Um, so you can really use- That's-...
• 11:23
  this as a, a stocking strategy. Man, that's... Oh, yeah. So, like, to put that together in case you missed it- How do you stock the used cars that are right for the conquesting? Golly. If-- Right.
• 11:31
  Because if 72%- Great question...
• 11:32
  of the truck buyers are buying another truck and only 47% of them are buying a Ford truck, like, coming back to Ford, that, the difference, it's almost 30% of those buyers are gonna buy a different brand truck.
• 11:45
  So you're saying, like, you might, you better have the different brand trucks on your lot so that you can keep the buyer even though they're not gonna be brand loyal to Ford. Yeah.
• 11:53
  And I think that gets- Well, and that's the s- that's the same thing with the Ford and Toyota buyers defecting more to premium brands. It's like, hey, maybe you need to have those, you know, late model year, uh,
• 12:06
  premium brands in your used car inventory as a comparison. Like, that's a stocking strategy right there. Yeah. Yeah. Well, and you, and you look at used vehicles too.
• 12:15
  I mean, I think this year we're gonna see a pretty decent importance put on used vehicles across, across retailers. When you look at some of the numbers, I was looking at this, uh-Earlier this week, I think it was.
• 12:27
  But, you know, when you look at actual vehicle sales and you, and you look at combined sales. So new sales, we kind of know what those look like. Used sales, some of us pay attention.
• 12:34
  But when you look at the combined number, um, last year, so 2023, had the lowest number of combined sales since 2012. So just, just over 51 million. Um- Man...
• 12:45
  so, you know, what you, when you, when you look at that, you got to imagine that we're probably not gonna go, go down much from there. So we...
• 12:52
  I, I look back to 2010 which, it was just under 50 million, and we're just over 50 million last year. Um, so we're probably gonna see some level of, of increase in overall vehicle sales.
• 13:03
  Um, not to mention when you look at... Uh, I don't know if it's a correlation or causation. I think it's causation. But when you look at, uh, election years, usually there's- Mm... there's general optimism, right?
• 13:13
  Either, no matter which side of the aisle you fall on, you- Change is coming, right? [laughs] Right. Or points, or things are, you know, things are gonna stay the same and you like them, right? Yeah.
• 13:19
  So one way or the other, you- Right. Something good. Right. You have optimism. Um, so anyway, heading into, into the election year, we got that going for us. But then also when you look at the mix of new to used.
• 13:30
  So last year had the highest percentage of basically total vehicle sales. So when you look at, uh, new and used combined.
• 13:37
  Uh, the highest percentage of, of new vehicles making up that total vehicle sales since 2012, 2016. Um, so- Yeah... over, over 30- Which makes a lot of sense because we had inventory for the first time. Yeah.
• 13:50
  And there was the most incentive put on new vehicle interest rates for manufacturers, which were helping the affordability issue, which wasn't able to be helped with rising interest rates on used cars.
• 14:01
  So it make, it makes sense that new vehicle sales would be at a, at a high last year, for sure. Right. But, you know, when you look over time, it's probably not gonna stay there, certainly not increase. Right. Right?
• 14:11
  So from a percentage perspective and a unit perspective, we're probably gonna see more used vehicles, uh, becoming an important part of, of the dealership's retail strategy, uh, I, I think in '24.
• 14:23
  So, uh, also in the report, one of the indicators or one of the assumptions is that the cost of borrowing likely is going to stay high. Mm-hmm. Do you have any more depth on that?
• 14:31
  I mean, financing and interest rates, huge conversation everybody's watching. Is there any, any more pulled out of the report other than that? Um, no.
• 14:38
  I mean, it's really just looking at, at the way the Fed's acting, right, and where they're putting rates and, and how they're, um, reluctant to, to come down.
• 14:46
  Um, so, you know, I think everybody's prediction has, has been pretty conservative here recently on what '24 is gonna look like as far as rate reductions, if there are any.
• 14:55
  So, um, when you, when you look at it, you know, cars are expensive. New cars, I, I don't know, what was the average price last year? 48 grand or something? It was... It's, it's high. Whatever it is.
• 15:03
  Darn, darn near 50 grand. Yeah. Um, which is funny. It's a [laughs] funny story. I watch this, this video every now and then, and it's got a clip in it of, um, this Escalade commercial.
• 15:15
  And it, it was talking about how, you know, an Escalade just hit $50,000. There's no way- Oh. [laughs]... a human- Man... right? There's no way- Can you imagine...
• 15:25
  a personal consumer's gonna spend 50 grand to put a vehicle in their, their own driveway. Um, and, and now it's like- Now Escalade's are like 120. [laughs] Right? [laughs] That's unbelievable. You gotta send us that.
• 15:37
  Oh, yeah. That's unreal. You can, you can get, like, a Corolla now for 50 or... [laughs] Right? That's what it, that's what it feels like. Let me read a couple more of these points.
• 15:46
  Um, kind of going back a little bit to the conquest. So basically, uh, just want to make sure people can hear them in case they don't see the report. Overall brand retention, 43.7%.
• 15:55
  Toyota has the highest retention at 60.1%. No big surprise there. Um, here's an interesting one. Nissan is a target on every mainstream brand's conquest list. Yeah, that shocked me. I don't...
• 16:09
  Uh, there was just consistency across every brand that Nissan was in the top five conquests for- I mean, I guess...
• 16:16
  Uh, okay, so if I, if I, like, just quickly try to think through that, Nissan is definitely seen as, um, kind of like, not, not quite like a starting position like a Mitsubishi, like, to get into a new car.
• 16:27
  But Nissan's also, like, kind of like the quality of vehicles and the, like, the appeal that they've started to have with some tech and things they're putting in there, definitely moves them a little bit closer to, like, a transition into a Kia, Hyundai, um, you know, some, um...
• 16:42
  I don't know. What's another brand that, that kind of has that little tech, tech kind of feel to it?
• 16:46
  So I guess it makes sense that, like, the Nissan buyers coming out of their Nissan, they got that, they made it to the other end, might be a, a really good bump set into another brand.
• 16:55
  Well, and, and if you look at it, uh, Paul, similar to Toyota but not with the brand equity of Toyota, is they have one of the widest, uh, vehicle lineups. That's a great point. Right? So when you look at...
• 17:09
  A- and not just that, but from a price point perspective, they have a very, very wide price point. Yeah. And so if you look, any OEM essentially can look at a, a Nissan buyer and find- Find a segment...
• 17:22
  a segment- Mm-hmm... that matches their target audience. So that's, that's where that kind of starts to make sense for me is, you know, a Kia could be seen conquesting sales from them. Easy.
• 17:34
  But also some of the luxury and the high lines and even sports cars and, and, um, larger crossover utility vehicles and things like that, like, all have segments that they could target from Nissan.
• 17:46
  So- That's a great insight... watch out if you're a Nissan dealer. [laughs] You know? They're coming for you. [laughs] Well, back to the used car strategy, right? [laughs] Right.
• 17:54
  Yeah, back to- All the way back around we get. [laughs] I love it. That's so much fun. Well, hey, uh, at time of recording, we're gonna be coming and hanging out with the team at Reynolds, uh, at the location.
• 18:08
  So- Yeah, can't wait... if, if this has come out afterwards, we might have a, a couple sneak peeks around, around the area there in the behind-the-scenes of what happens down at Reynolds.
• 18:18
  Any- anything that we should be, uh, watching out for or excited for on the grounds of the Reynolds headquarters? Um, sure. I mean, a couple of new things.
• 18:25
  Well, you turned me down on the workout before you got to get on a plane, so you won't get to see the gym, I guess. But, uh- I was excited to have Kyle... Well, we could go see the gym. We can see the gym.
• 18:33
  Kyle doesn't want, just want to go get all, like, run three miles and then go get in line next to everybody that doesn't want him next to them in line 'cause he just worked out.No, we'll definitely have to check out...
• 18:42
  So a couple things we'll, we'll check out. One, um, our, our security operations center, our SOC, that we built out this year. It's, uh, it's pretty impressive. I think you guys would like that. Sounds great already.
• 18:50
  Um, and, uh, we'll check out our, our... We'll actually do, you know, as long as you guys are still up for it, we'll do a, a podcast recording in person in our studio. Heck yeah.
• 18:58
  Um, and then gotta show off to you guys our, our video production studio, uh, downstairs, too.
• 19:03
  We have a, a production team here, and, and they do ex- excellent things, but they have some pretty cool stuff that, uh, you guys will probably get a kick out of. So, um, we'll make sure to, to give the full tour.
• 19:13
  Well, you're speaking our love language. I can't wait. [laughs] He was like, "Production, production, workout. Good." [laughs] That's perfect. We'll get a little work done while we're there, too.
• 19:22
  Greg, thank you so much for, uh, just being so open-handed, uh, with sharing the reports and, and serving the industry in this way. And, and always, thanks for giving us, uh, a few minutes of your time today.
• 19:31
  No, thanks, guys. Always fun, and look forward to seeing you soon. Well, first of all, I can't believe that I forgot...
• 19:38
  Uh, that I, that, like, just a couple days ago I was talking to my father-in-law about the fact that he had worked with Reynolds- That's unbelievable...
• 19:45
  and then for them to have done the brand discovery of going back on the logos and all the things like that. We need to have your father-in-law on the show. He's actually, he's,
• 19:55
  uh, uh- I like the way you w- Another story I like the way you used "actually" in there He would be great on the show. He would be great on the show. [laughs] But here's the other thing, is
• 20:02
  I, uh, first, the, the first thing that I appreciate about this whole podcast is obviously Reynolds has marketing arms and communications and digital retailing and DMS and, and, and security and paper and all that type of stuff, but this is completely service.
• 20:18
  Like, "Hey, we have access to a whole bunch of data that can serve dealers to make really, really intelligent stocking, marketing decisions, no matter what the provider that you is.
• 20:28
  There's not a clean cut and solution for this. But hey, look, if you're paying attention to where customers are moving from- Mm-hmm...
• 20:34
  and to what they're buying right now, what they might wanna buy over the next year, you can be really, really intelligent about the way you spend your money, the way you stock your inventory, the way you go to market."
• 20:44
  Um, so just appreciate Reynolds and f- Greg for bringing that to, to life within this, uh, this conversation. It's really great.
• 20:54
  Um, we are going to link the report in the show notes to this so that if you're listening to the show, the link will get you directly to the report so you can check out, uh, the full thing.
• 21:03
  You know, we were only able to cover a fraction of it. Um, just even what we covered I feel like is so actionable. Like, there are so many things. Yeah.
• 21:10
  And that, and that's always the most rewarding thing for us, that if through this collaboration mindset, we can bring a couple people together and even have one thing, right?
• 21:18
  If we're talking about the, like, the Nissan conquest, or we're talking about the used car allocation on the tr- on the...
• 21:24
  Or the used allocation you have or the inventory you stock because you know about who's gonna get out of a truck and what percentage is not likely to come back to your brand.
• 21:32
  I feel like those are things that can just drop in dealers' mind, and now- Absolutely...
• 21:35
  when they're on vAuto, when they're meeting with their GM or their sales managers, they can just drop this little thing and it can affect real change. So I'm always happy when we get to that point. Always happy.
• 21:44
  Well, hey, we thank you for joining us on another episode of Auto Collabs. On behalf of Paul Jay Daly, myself, and even Michael Cirillo, who shall be back soon, uh, thanks for joining us. We'll see you next time.
• 22:01
  [upbeat music] Welcome to Auto Collabs. Welcome to Auto Collabs. [laughs] Are we recording yet? Are we rolling yet? Not yet.