Every year during the North American Parts Benchmark (NAPB) Conference held in April, Carlisle discusses the top emerging trends that motor vehicle OEMs should prepare for and strategize on – Carlisle’s very own Crystal Ball Presentation.
Carlisle would like to provide a sneak peek into the upcoming Crystal Ball Presentation, offering some highlights of what’s to come. This year, Carlisle selected four key topics that OEMs need to address in the near term. All four have a unifying theme of “re-examining previously held ideas on what we deliver.”
Carlisle’s line-up for the upcoming 2021 NAPB Crystal Ball Presentation is:
- How Important is Fill, Really?
- Digital Ownership
- Point-of-Sale Financing
- Climate Change
How Important is Fill, Really?
We’ve always thought high facing fill on stock orders was the ultimate dealer demand. It’s the primary way OEMs measure the level of service their networks provide. However, Carlisle recently conducted focus groups that shook up these beliefs – some dealers were indifferent to facing fill for stock orders.
In this section of the Crystal Ball, Carlisle will examine whether dealers truly care about facing fill. To do this, Carlisle plans to conduct more targeted focus groups this year to learn exactly how dealers feel about facing fill, versus some other highly demanded “features” such as:
- Faster order response times
- Later cut-off times
- Better order transparency
- Higher dealer off-the-shelf fill
Depending on the results, Carlisle may also launch a conjoint survey to better quantify dealer opinions about fill.
We’ve always been satisfied with our existing method of service delivery. Particularly in the automotive sector, it’s very hard to sell parts without also selling service via the dealer channel. But as customer expectations continue to change, driven by an ever-rising bar set by innovative companies like Peloton, OEMs must re-examine their own method of service delivery to keep up.
Truthfully, Carlisle held its own preconceptions about delivering service… that “going online” was sufficient to both addressing the changing customer needs and competing with non-traditional players in the market (like Tesla and Carvana). To prove it, Carlisle launched the 2020 Consumer Sentiment Survey. The survey did confirm that customers want digital processes, yet the major takeaway was that the OEM and dealer’s version of “going online” was not cutting it for customers.
In this section of the Crystal Ball, Carlisle will examine how different players are attempting to convert their vehicle ownership experience to “online” and what actions need to be taken to truly digitize the experience.
We’ve always assumed we have done everything to get every dollar out of every customer. If the customer cannot afford genuine parts or dealer labor, OEMs have some clever ways to discount the products and services. But ultimately, that is a lost sale.
What if, rather than focusing on pricing, OEMs could focus instead on the customer’s ability to pay. How can they give the customer more money to buy products? Point-of-sale financing (think “Pay $32 a month for 24 months for this repair”) is extraordinarily popular in other sectors, but it’s relatively new in the motor vehicle space. By offering this financing, OEMs give customers access to money to buy what the dealer is selling.
Point-of-sale financing offers some intriguing benefits at a known cost, but most POS financing is for products, not services. Is there a way to overcome this challenge? Carlisle will look at the pros and cons to see whether this idea is worth exploring for OEMs interested in improving sales.
We’ve always focused on efficiency in the supply chain. However, the COVID-19 pandemic shined a light on the fact that maybe the focus should expand to resiliency. Climate change dynamics over the next 10+ years prove that OEMs need to focus on developing supply chains that can stand up to fires, floods, pandemics, and other climate effects.
The problem with covering a broad topic like climate change is that it is often hard to know where to start. Therefore, Carlisle developed a framework to categorize climate risks in a way that helps OEMs prepare for these changes. First, Carlisle will look at demand factors: Are people still going to want what OEMs are selling? Are OEMs legally allowed to sell it? Then, Carlisle will look at supply factors: Can OEMs still make the things they sell? Can OEMs get those things to customers? Finally, Carlisle will show a long list of potential mitigation strategies and remedies to some of the risks posed by climate change and help OEMs understand how to prioritize these initiatives. Ultimately, Carlisle will help guide OEMs to evaluate the different ways to make their supply chains more resilient.
At the end of the presentation, the audience will take away some new theories about what they always thought they knew. This presentation is supposed to be provocative, and in the end, the audience will need to decide how to go forward as a motor vehicle OEM in an ever-changing industry.