The Light Is Green

Lower margins, what to do

I just read an article on the hurdles facing auto dealers in Ireland, that underscores the topic of our upcoming podcast (should be ready in a few days).

The main focus is on a trend that started a while back in the main markets (U.S., Canada, Europe) and is continuing throughout the world: margins on car sales are dropping and will go on dropping.

The thing is, turnover may be OK but as margins tend towards the "razor-thin" variety, dealers can either choose to hide their heads in the sand, or get ready to react. And quickly.

The solution is of course After Sales. Parts and Service need not be necessary evils as some dealers still think, but rather excellent profit sources. This obviously won't happen magically, but in our podcast we'll address how a dealer can get started.

On a related note, manufacturers are starting to mandate better after sales operations in their bids to increase customer satisfaction.

So if a dealer hasn't started to move in this direction, they definitely will soon, or risk going out of business altogether.

Bush does ethanol

Just read on Reuters that President Bush, in a bid to counter sky-high oil prices, suggests that Congress find a way to approve ethanol refinery permits a year after they are filed. This was during a speech to the pro-ethanol Renewable Fuels Association.

(He also gave U.S. refiners extra time to pay back emergency oil loans...)

What is Web 2.0

I received several emails on a previous post asking me exactly what Web 2.0 is, so maybe that needs a little clarification.

First off, note that the answer will depend on who you ask. But in general sense, it's important to point out that this is not a new incarnation of the web.

Rather, I'd say that Web 2.0 is just (don't mean to minimize, but I want to get the point across that this not a "next-generation" or "evolution" or other grandiloquent term) short-hand to encompass a whole bunch of web-based applications and services that did not exist before, or if they did they were primitive and not very useful.

In one sense maybe there is some evolving going on, as this time it's not about the PR but thankfully about usefulness.

Microsoft redesigns ipod packaging

Here's a very funny parody of Microsoft marketers "improving" the Apple ipod's award-winning packaging, throwing everything humanly possible and then some, totally ruining what was at the start a subtle thing of beauty. See it here on Google video.

Microsoft itself produced it for internal training and are very gracious about it being seen outside of Redmond.

Passion + coolness

Here's a quotation that comes from the world of art, but is equally applicable to the world of business, and I guess to any walk of life and everything you do:

"The works must be conceived with fire in the soul but executed with clinical coolness."

In celebration of Catalan painter and sculptor Joan Miró, born this day in 1893.

Note: Google takes this to heart, that's why they are the undisputed leader. Check out today's Miro'd Google logo and tell me this isn't so: 

Japan, Toyota taking good look at ethanol

This isn't exactly breaking news. But it is noteworthy that Japan seems to be setting its sites on ethanol possibly becoming the biofuel of the future. At the KONARC Sugarcane Breeding Lab in Japan they've developed a "monster" variety of sugarcane that produces 3 times as much ethanol as other varieties.

The excellent experience in Brazil with flex-fuel technology, who actually chose to go the ethanol route decades ago and is now practically impervious to fluctuations in gasoline supply, serves as an excellent model for the whole world.

And it looks like that Toyota is developing flexible-fuel vehicles and plans to sell ethanol cars in the U.S. by 2008.

The most influential brand on Earth

What would you say is the most influential brand in the world today? The first powerhouse names that came to my extremely unoriginal mind when I read this article in Business 2.0 were Coke, McD, Nike, Microsoft, Fedex, in that order.

None of these is the most influential brand in the world, according to a recent survey by Brandchannel.com.

My next choices were Adidas, Sony, Toyota, Ford. I thought of Diego Maradona, the greatest football player ever and author of the two best goals in history. I thought of Michael Jordan. Star Wars. Harry Potter.

But I would never have thought that Google is now the title-holder. Turns out I didn't think of #2 either, Apple.

Here are the top ten, in order of placement, by region:

Worldwide: Google, Apple, Skype, Starbucks, Ikea, Nokia, Yahoo, Firefox, eBay, Sony.

Europe and Africa: Nokia, Ikea, Skype, Zara, BMW, BBC, Adidas, Al Jazeera, H&M.

North America: Apple, Google, Starbucks, Target, Lance Armstrong, Craigslist, Whole Foods, Coke, Oprah, Amazon.

Asia Pacific: Sony, Toyota, Samsung, LG, HSBC, Singapore Airlines, Honda, Lonely Planet, Tiger Beer, Hello Kitty.

Central and Latin America: Corona, Bacardi (hmmm, so far not a healthy sign!), Movistar, Havaianas, Cemex, Cafe de Colombia, Bimbo, Natura, Lan Airlines, Concha y Toro.

I don't agree with these results... I can't think of a polite term so I'll just leave it at that. Asia Pacific seems believable, maybe Europe. But in the global list, there seems to be a large U.S. slant, unintended I'm sure, but come on! Some anomalies that stick out like sore thumbs: Starbucks is #4? Sony #10? No Toyota or even Ford? No Microsoft?

Personal gripes aside, the conclusion we can draw is that Internet companies are powerful brand names, more powerful than one would assume. And Google seems like a fitting king when you think about it.

Who's our competition?

One of the obvious questions that comes up in every interview I've done is: "Who are your competitors?"

The answer in the case of our Autologica Dealer Management System is that it depends on the market.

In mature markets we're usually competing against one or both of the major DMS players, Reynolds and Reynolds and ADP. I'd also mention Kerridge but they were acquired by ADP a few months ago.

However in some emerging markets we're likely to be up against two competitors who wouldn't even be taken into account in the aforementioned regions:

1. Standard Financial packages. Sometimes these take the form of one of the world-class (whatever that means) systems, sometimes it's a smaller regional player, and sometimes even a local off-the-shelf accounting system.
2. Homegrown systems. In this scenario the dealer hires out the development of a program to a local (usually very small) programming outfit, and sometimes even to a family member.

These solutions are at best a recipe for inefficiencies, and at worst a disaster waiting to happen, much more so in the case of Alternative Solution #2.

In mature markets dealers will base their decisions mainly on functionality, prices, and track record, so that's we'll focus on.

But in emerging markets, in the case of dealers who are thinking of Alternatives 1 or 2, we have a difficult task ahead of us: helping dealers see the huge benefits they will receive if they choose a full-fledged dealer management system.

In my next few posts I'll be delving into this issue and hopefully some interesting information will come to light.

Cool tool: Ta-Da Lists

Ok, so I guess we really needed a name to encompasses the slew of new Internet based tools that are coming out, a very heterogeneous bunch: gmail, google earth, myspace, flickr, youtube and other community/social tools, and on and on. (The name is Web 2.0.)

Many (most?) are for personal use, and liking them depends on your own tastes and habits.

But some of these tools are business-oriented... I'm trying Ta-Da List, which lets you create multiple, shareable to-do lists.

The first thing you'll think is, "What a simple idea, why didn't I think of this!" The next thing you'll do is start using it. I've found it quick, easy and very useful for keeping (surprise) to-do lists with each of my department heads. It's limited, as all you can really do is list items, without categorizing or creating subitems. BTW, it's free. Their idea is that if you like Ta-Da you'll upgrade to their fee-based, more complete offerings.

Idea-borrowing at the Oscars

Maybe I was the only one who saw Amazon Women on the Moon (1987), but it really bugged me that Ben Stiller's sketch during the Oscars unashamedly lifted from Ed Begley's "Son of the Invisible Man" scene in that flick, without so much as a nod to the creators.

BTW, that Begley gag is the funniest thing I've seen in movies, along with the Peter Sellers pool scene in The Party, and Steve Martin/Michael Caine in Dirty Rotten Scoundrels...