In the current business climate, there are a lot of conversations around delivering value. But let’s take a step back and ask an important philosophical question: What, exactly, is value in the context of brands and their independent dealer channel?
Sure, brands want dealers to succeed. But what is required for success has changed drastically. Historically, brands reward dealers for sales. And that made sense until relatively recently. That’s the classic definition of value in monetary terms. It’s transactional and short-sighted.
Value is a very vague word. It often means “cheap”. Value pricing. Value pack. Best value. Sometimes we speak in terms of solving problems for customers as adding value. Things like removing friction and bundling services with products. But when you scratch beneath the surface of those business tactics it is usually a carefully packaged set of longer-term transactions, and dealers are still expected to make it rain.
Given the pressures of supply chain disruption, inflation, and labor challenges, manufacturer brands are changing their definition of value. And though many are looking farther down the road there is a risk of forgetting the role dealers play in this continuum.
Dealers are already familiar with the idea of delivering value to their customers in two specific ways: Relationships and expertise.
Dealers own the customer relationship.
The dealer is the face of your brand to their customer. It’s not your customer. The customer may own your product, but chances are good you couldn’t pick them out of a police lineup. The dealer is the day-to-day contact. The dealer is the one they call when there’s a problem. And the dealer is often at the mercy of the manufacturer brand on everything from product availability to warranty claims. Most dealers understood the value of creating a great customer experience long before it was today’s buzzword. Their customers trust them with their business and so should you. Which leads to our next topic.
Dealers are experts.
Business-to-business dealers are the original specialists, both in their region and in their industry. They are closer to the customer’s business in every meaningful way. Many dealer salespeople were once on the other side of the table in the role of the customer which gives them a perspective that most manufacturers can’t touch. The narrower the dealer niche, the more value they have to the customer. They have a shared language that saves time and gives the customer confidence that this dealer will know how to avoid pitfalls and minimize problems.
Now, given this understanding of dealers, how do we amplify their ability to deliver value?
There are three tactics that facilitate this process.
Yes, I know. But until we get this part right everything else is an uphill battle. Dealers need to know what is going on with your product and brand both operationally and strategically. And communication doesn’t mean sending out a regular email broadcast. It needs to be a conversation where dealers are allowed to contribute in a meaningful way.
Dealers share in the risk as well as the reward of all the product decisions you make as a manufacturer brand. It stands to reason that they should get a voice in the direction of the brand. We aren’t saying hand over the keys, but we are saying they know things you don’t. And their input can help you see new opportunities.
Dealers need to know that they’re part of your team. That means giving them access to product experts, technical support, and sales support. This can take a lot of forms, depending on the market you’re in. It could be partnering with a dealer to help them win a new customer, or it could be facilitating factory tours for their customers. Or it could just be answering their questions promptly. In conversations with dealers they often feel like there is a wall between them and the brand they represent.
A word of caution.
This is not something you can just check off your dealer to-do list. It is a set of behaviors you have to implement. Yes, everything is more complicated than a short article can cover. But it’s also pretty simple.