I try to comment as little on the news as possible, but a piece I read in the WSJ this morning could simply not be ignored. The article explains how high-pressured salespeople are being replaced with a combination of concierge-like services combined with a strategic dose of digital signage.
It appears BMW is further decreasing the bloat of human capital from its balance sheet and replacing it with a more automated and web-like atmosphere reminiscent of Apple stores, where the “Genius Bar” is managed by what I would call non-pushy product nerd-lets.
From the article it appears BMW isn’t taking it lightly. It’s using as many as 100 different variations across its dealerships, perhaps as a testing ground to see what works as what doesn’t. Each locations comes complete with digital signage, iPads and tablets for the would-be salespeople and–more importantly for the dealerships–a gutted sales staff.
I’ve discussed before about how one of the big benefits of using today’s technology is the automation of processes, the elimination of staff and overall increases in bottom-line output. BMW dealerships are also having a rough go of decreasing product margins, which is putting pressure on decreasing cost bloat across the board. Hence the drastic changes and digital showroom testing for its dealerships.
And those are just the benefits to business side. Multiple upsides remain for the consumer, including an enhanced experience, faster waits and overall less “pushiness” from fast-talking salespeople. If the models prove themselves, some dealers will provide a no-frills experience in what seems like a vending-machine-style approach, while others will offer a full concierge method, complete with a titillating virtual experience complete with digital signage.
But no efficiency enhancements come without a price.
Like Clayton Christensen claims, efficiency comes at the expense of jobs and innovation , hence our “jobless recovery.” Secondly, for as much as we wish to remove humans from any equation that involves an extremely large purchase, there will always be push back from some consumers. People still need high touch–something a touch screen may not provide in a moment of question. Significant salesperson reductions may jettison this important piece of the product purchase value chain. Most can get their virtual fix by surfing the web on their large flat screen at home. They come to the dealer to get in, drive and get hands-on.
While there are upsides and downsides to this approach is great to see retail is finally “getting it” when it comes to digital signage. It’s not just for pushing sales as an added expense. It can truly be integrated holistically as a cost-reduction strategy in reducing costly salesperson headcount. Sadly, such reductions will continue to roll on as part of the automated revolution of today’s technology.