January 26, 2024 • 42 mins
Maritz Automotive with Terry Irvine
Welcome to the EVready Podcast with Chris Nihan. Today our special guest is our new partner, Terry Erwin, the SVP of Sales at Maritz Automotive. With over 128 years of experience, Maritz is a powerful ally to automotive dealerships, offering comprehensive programs that focus on OEMs, training, loyalty marketing, and driving positive behavior to help sell more vehicles, parts, and services. Maritz and EVready Energy are partnering to bring tailored training programs to dealerships to help move more EVs off the lot to consumers. The focus will be on the importance of EVs, providing training for executives, sales, and service teams along with comprehensive knowledge about the EV ecosystem, including cost of ownership and available rebates and incentives. As we look to the future, Terry and Chris acknowledge that the collaboration between utilities, OEMs, and government entities over the next 10 years will be crucial in making the transition to EVs smoother and more accessible to drivers. EVready Energy is excited to partner with Maritz Automotive and looks forward to helping auto dealerships reach their goals in 2024 and beyond! To learn more about Maritz Automotive's commitment to transportation electrification and its role in shaping the future of EVs, visit their website at https://maritzautomotive.com/transportation-electrification. https://evreadyenergy.com/podcast/the-need-for-ev-training-at-automotive-dealerships-with-maritz-automotive/ See the video interview
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:03):
Welcome to the EV Ready podcast, featuring industry leaders and their perspectives
on electrification, hosted by EV Ready Energy.
Hey, everybody. Welcome to the EV Ready podcast, and we're ringing in the new
year with Terry Irwin, SVP of Auto Sector Sales at Maritz Automotive.
(00:24):
Terry, thank you so much for taking the time. I do appreciate it.
Yep. Thanks for having me, Chris. Yeah. And I just want to give a background for everybody.
So Terry and I connected a little under a year ago.
I think it was at an auto manufacturers event and the relationship's kind of grown ever since.
But yeah, Terry, you mind telling the story about how that all kind of came about?
(00:44):
Sure. Yeah. Actually, I think the first time we met, you served as a panelist
and a guest speaker at a conference that we were running.
And that would have been, I guess, around 2022. 22.
And then at that point you were with ChargePoint.
And then last summer we ran into each other at a manufacturing conference for
their dealers that was focusing on fixed operations.
(01:05):
And you told me a little bit about what you're currently working on.
And it really piqued my interest because I think there's a lot of overlap with
what you're trying to do in terms of being in a dealership and kind of the education
and engagement element that's so important to get get dealerships ready to sell
and service electric vehicles.
Yeah, it's funny. For a second, I forgot about that. But obviously,
(01:28):
we're going to talk about that a little bit later today as well and the importance
of that conference and what you guys are putting together.
But yeah, I think education is obviously a huge challenge right now in the electrification space.
And I'm sure we're going to jump into that shortly.
And I think our intention is to figure out a way to help consumers feel a little
bit more confident about purchasing electric vehicles in the future.
(01:51):
But before we get into that, I just want to ask you a few questions.
So first, it's really interesting, even when we started initially speaking together
about some of the things we could do together, like admittedly,
I didn't fully understand ss and what it is and what your role was and what you focused on.
So tell us a little bit about that because I really do find it interesting.
(02:12):
Sure. Well, first of all, Maritz is a privately held company headquartered in
St. Louis, Missouri. And we've been around.
For about 128 years. And I've been around for a lot of that,
not all of it, but the last 30 years, I've been working for Maritz in a number of different roles.
And we're broken into three different companies. So we've got Maritz Engagement
(02:33):
Solutions, which focuses on things like loyalty marketing and incentives,
recognition, award-based programs in verticals like hospitality,
financial financial services, pharma, and a number of others.
We've got Maritz, what was called Maritz Global Events, which is now event
solutions, business event solutions.
(02:54):
And that's really our travel meetings, events, and incentive business.
And we do that across all of the verticals. And that would include things like
incentive travel, group business meetings, big events, things that our clients put on.
And those are largely for Fortune 500 companies. And then the third company
is Maritz Automotive Solutions.
So I'm the chief sales officer for the auto group.
(03:17):
And what we really have built our business around or modeled our business around
is becoming the industry's leading automotive retail performance agency.
And what that means is we focus on our clients who are the OEMs,
and we put together programs that are specifically implemented at the dealer body level.
And we have a number of different tools in our portfolio. So our solutions largely
(03:41):
are made up of things like incentives and recognition.
Training is a big part of our business, digital marketing, loyalty marketing.
We work with our sister company on meetings and vets and incentives.
And what we're trying to do primarily is drive positive behavior at the dealership.
And my 30-second pitch is we help our clients sell more vehicles, parts, and service.
(04:07):
And we focus on the people who are on the front lines in those dealerships,
making sure that they've got the tools that they need to be successful in their
jobs to drive things like SSI numbers and CSI numbers.
And we help them attract, engage and retain the very best employees.
You told me a stat once. I just think it was really interesting.
(04:27):
I think it was related to Maritz travel as to like how many hotels that you
book compared to the second. What is that stat?
Well, I'm not sure exactly what the stat is, but we have the largest hotel room
bookings by a factor of probably five.
I mean, we are constantly, every day of the year, moving people around to big
(04:48):
events, doing incentive travel with them.
In the auto industry, it's really interesting because it's a great fit for how
they traditionally go to work with their dealers. I mean, obviously they're
bringing out new products all the time.
We look at the product calendars and the launch calendars, and we are responsible
for executing a lot of dealer meetings.
So an example of that would be bringing in 2,000 to 3,000 dealers to a place
(05:12):
like Las Vegas, where we would handle everything from all of the hotel contracting,
all the logistics to the meeting event, the production,
the entertainment, things like that.
But primarily to get the dealers familiar with the business plans,
the marketing, and and the product launch sequence.
Yeah, I remember when I went to the Future of Automotive retail conference and you guys hosted that.
(05:34):
I didn't realize exactly what you did yet. I didn't realize what was happening,
what I was invited to. It was really well done.
It was really well done. And to hear that that's like a full-time thing isn't shocking.
I know this is going to be updated by the time this podcast is released,
but I'm going to the Consumer Electronics Show next week. And I know you guys
are hosting that one too. That's a pretty big one.
Yeah, we'll have a big presence there as well. Well, let's focus on the automotive piece of Merit.
(05:58):
So, you know, it's really interesting when I've tried to high level explain,
when I talk to people about Merit, I explain that you're an automotive performance
retail company and, you know, you gave your 30 second sales pitch.
I'd love to hear a little bit more than the 30-second sales pitch though,
like for the people who don't know what CSI stands for.
If you can give like a little bit more granular of what you're doing all day,
(06:21):
you know, what folks are on your team at your company, how you guys kind of
go to market, we'd love to hear that. Sure.
Okay. I guess maybe to give it a little more detailed picture.
First of all, CSI stands for Customer Satisfaction Index, and that's the surveys
and the data that comes back when people have their vehicle serviced at a dealership.
But SSI, I mentioned also Sales Satisfaction Index.
(06:42):
So customer goes in, buys a new vehicle. How is your experience at the dealership?
We're not in the research business anymore, but we're very much in the data insights business.
So we really look at how dealerships are performing, how the OEMs,
how the brands are trying to drive performance at the dealership.
And we kind of sit in the middle.
So we have a team that's deployed around the country. We've got automotive offices
(07:07):
in Detroit, Los Angeles, Plano, outside of Dallas, and in Nashville.
And we've got account teams there that are built largely of people who have
both OEM and retail experience.
So they've worked at a manufacturer or they've worked at a dealership.
So they really understand the dynamics of what happens when it's time for somebody
(07:28):
to sell a car or service a car. And then I would say where we really try to
focus is if you back up, we help our clients sell more vehicles, parts, and service.
We're putting together various types of programs that really make sure that
the people on the front line at the dealership understand objectives.
Have the tools to execute those objectives, and in many instances,
(07:52):
have some sort of a motivational factor.
So that could include an incentive or recognition for the dealership.
But SSI and CSI are important because those are critical KPIs,
benchmarks in the industry.
And we just feel like the better equipped an employee is, the better they're
going to do their job, the higher the performance levels are going to be.
(08:13):
Everything in automotive gets measured.
And also, the more likely they are to be successful in their job,
happy in their job, and remain in their job.
It's an industry that's traditionally had a lot of turnover at retail.
So we're focused on being the real powerful ally for the manufacturer because
we understand dealerships, how they work, and how they interact with their customers.
(08:36):
What's the state of how your business interacts with dealerships as it relates
to gas cars versus electric cars?
Does any of it overlap, completely separate?
How do you think about it? Let me make sure I understand the question.
What are the differences between selling electric cars and gas cars?
Yeah, like how does your company work with dealerships? Do you work with dealerships
(08:57):
differently depending on what types of cars they're selling?
I guess, I mean, there are nuances for sure. At the end of the day,
dealerships are all about selling new vehicles, right? They've got multiple revenue streams.
They're selling new vehicles, leasing new vehicles, getting people to come back
to do their servicing. They've got financing products.
So, I mean, there's a lot of ways a dealership can be making money and be profitable,
(09:21):
but we all know at the end of the day, they've got objectives to sell vehicles
every single a month, they get measured on a 30-day basis.
So whether it's a nice vehicle or an EV, there's still going to be a lot of
motivation to move those things.
Nobody wants any vehicle sitting on their lot for longer than they have to.
What we've tried to do is get a real strong perspective on what it takes to
(09:45):
be a successful EV dealership and what that means in terms of communicating
with a customer, attracting the right customer,
making sure that their buying experience is a good one, and then making sure
that they're really fully prepared for ownership.
Because we know that there are a lot of differences there, right?
Every time I've ever bought a car, an ICE vehicle, you pull out of the dealership
(10:07):
and you're kind of good to go at that point, right?
You can take your car back for service if you want.
There's a lot of other options in the aftermarket to service it.
But as long as I can find a gas station, I'm in good shape.
Now, when a consumer goes in and buys an EV for the first time,
there are a lot of other things that they'll have to understand for the first time,
including what kind of charging requirements are there, or can I put into my
(10:32):
home? What's the grid look like?
What's the usage of this vehicle going to look like for me? And ultimately,
I think one of the most confusing things is what's it actually going to cost me to run it?
I think there's a big misperception there around, hey, I'll never have to buy
gas again. So this car is really not going to cost me anything to run.
And people People don't understand electric consumption, demand consumption,
(10:55):
and that's a real opportunity for us to help educate not just the dealerships, but also consumers.
Yeah, yeah. And to your point, you mentioned it is about the consumers and helping
them, but it's also about dealer profitability.
It's about them understanding how the cloud ties to their vehicle now and how it ties to the utility.
(11:15):
So training now, I think, is partially about the consumer experience,
but would you agree agree that it's also, it's a little bit more than that too.
It's training for business owners as well.
Absolutely. Yeah. So we all know that there's been great advances in terms of.
The EB market and growth in market share. Obviously, it's much stronger in some
(11:36):
parts of the country than others.
However, everybody I talk to in the industry kind of acknowledges that the ship has sailed, right?
The investments that have been made over the last several years,
going back probably a lot more than just a couple of years, maybe over the last
10 years, have been significant.
Every major OEM, for the most part, is pursuing an EB strategy,
(11:58):
Many of which are going to, or at least profess to have only EV vehicles in their portfolio.
And there's some very aggressive benchmarks that are being set by the federal
government in terms of what they want to see in terms of overall market share.
So it's really critical that dealerships understand everything that goes into
the EV ecosystem and how they treat not just their customers when they come
(12:22):
in and are interested in an electric vehicle,
but what are the steps that you have to go through with dealership personnel
to make sure that they're properly trained on the sales aspect of that and the
servicing aspect of that? And really like cost of ownership.
I mean, there's a narrative there that they need to be able to be conversant with.
And also, there's a lot of unanswered questions because of all the complexities
(12:46):
around things like rebates and where those rebates come from and what qualifies and what doesn't.
None more than the IRA rebate of $7,500 per copy right now for vehicles sold.
That does not apply to many cars right now.
Isn't that crazy? Yeah. How few is it? I think I heard a number.
I don't know for sure. I heard it was like less than 10 cars qualify for the
(13:06):
test. I think that's right.
I think that's right. There was an article, I think it was in either last week's
Automotive News or the current one, where they really break it down.
And we're involved in really trying to help our clients and their dealers understand
where all that money comes from, what's available in terms of stacking incentives.
(13:27):
Until recently, there haven't been a lot of cash incentives on EVs because up
till, I don't know, six or nine months ago, the day's inventory was very low.
People were ordering those or pre-ordering those vehicles, taking delivery.
There wasn't a lot of inventory on lots.
Now, you're seeing that the day's supply is much longer, and I think you're
(13:48):
starting to see cash incentives that are going to be applying cash on the hood
incentives that than being applying to EVs, much like they have been to ICE vehicles in the past.
I heard a statistic recently. I think it was on Electrek that I read it from,
I think it was September,
relatively recently, where 50% of non-Tesla electric vehicle owners are considering
(14:10):
going back to gas or for their second car,
getting a gas car due to the experience that they're having, which is wild to me.
And I think we've all heard the reports about Ford not seeing the interest level
that they were expecting when they were initially looking to aggressively electrify.
Right. Your perspective, why do you think that is? Well, first of all,
(14:30):
in terms of the manufacturing commitments,
I mean, I think we've all seen things in the headlines about putting plans for
new battery plants on hold and kind of tapping the brakes on some investments.
However, there's still a pretty aggressive new product release coming out over
the next few years. So those vehicles have been designed and are being built
and are going to be hitting those showroom floors.
(14:51):
I think one of the big things that you touched on was really kind of the hurdle
around owning the car and not knowing how convenient it's going to be.
I mean, you can go to YouTube or watch the news almost any time,
and you'll be able to find people who are posting videos.
Their experiences of doing a road trip or reporters are getting in cars and
(15:13):
saying, I'm going to figure this out for myself.
There was a great article in the Wall Street Journal in 2023 about a couple
of women who tried to drive.
I think they were either going from New Orleans to Chicago or vice versa.
And the difficulty they had with plotting out their trip, getting to charging stations,
finding how many of those charging stations were not functional,
(15:35):
I've heard horror stories about people waiting forever to be able to go in and get a charge.
So that to me is a big hurdle that consumers are going to have to get over.
The whole grid piece, I think, is lagging the production and maybe some of the
consumer acceptance side of it.
There's a lot of things that you've got to plan for right now.
(15:58):
None of us ever thought about, boy, I don't know if I'm going to buy this ICE
vehicle because where am I going to find a gas station?
You know it's it's just a it's a non-starter what
i'm really curious to see over the next let's call it 10
years or so is right now like how close can utilities
understand auto manufacturers business auto
manufacturers under you understand utility business and then and how they can
(16:21):
connect with the consumer right um you know i think there's there's a little
bit of a a gap there in an opportunity for improvement and probably the other
third party is probably government it's it's It's the marriage of those three
that are going to make things easier.
And I think sometimes, to your point, sometimes you just go to charters and they don't work.
And I think Biden came out with funding recently. I don't know exactly what
(16:44):
the act was, but came out with funding for servicing and maintaining stations.
That's going to be a huge part of the future to gain consumer confidence again,
for sure. So I think that's part of it.
But then we've spoken so much. It's also about education.
Yeah. Yeah. Yeah. And just to kind of go back to your earlier point with what
we call the EV ecosystem.
(17:05):
So we have put together a transportation electrification board.
You'll know about that because you're a recent addition to our board and a very
valuable one, but we started this about almost two years ago.
And what was apparent to us is that there's a lot of players in and out that
connect to the consumer somehow when they buy an EV, right?
(17:27):
Used to just be the dealer pretty much. And now you've got, you touched on some of them.
You've got things like utilities. You've got government programs largely based
on rebates that are available to lower the cost of sale or ownership.
You've got infrastructure companies and you've got technology companies that
are really interacting, sitting
(17:49):
between an electric utility and the consumption of power in the vehicle.
So the consumer is touched by those in a lot of different ways, right? They are.
And I think the challenge right
now is they don't know that they are being touched by them sometimes.
You might be a business owner and you get an increase in your electric bill
(18:11):
and you think you have an energy efficiency problem.
You might get an increase at your electric bill at home and don't realize that
there's a certain rate that exists where you can get free electricity at nighttime
or discount electricity at nighttime.
I think once people realize the opportunities around electrification,
they're going to be a lot more excited about it when they see some of the things that are happening.
People don't know what they don't know, right? So they go out, they try something new.
(18:35):
And if everything feels normal, you don't hear from them.
If there's some type of a big problem, they get a loud microphone and they're
shouting from the rooftops. I think that's one of the challenges right now.
And I think the other big challenge that I don't really think anybody would
disagree with this, I don't really think the auto manufacturers would either,
is that there's an education challenge in dealerships right now.
And it's really nobody's fault.
(18:56):
I think it's just, you know, 2008, if you had a flip phone, it was a little
bit harder to sell a smartphone at the time.
And obviously, smartphones, they don't cost as much.
Adoption was quicker. Everybody had one. Everyone learned how to use it.
My two-year-old can look at pictures now on my phone.
Going electric isn't necessarily quite as intuitive. It's a little bit more
(19:16):
costly. The turnaround to get to your next car takes a little bit longer.
But I think that's the big opportunity right now in this space.
Infrastructure is a problem.
Hopefully, the cars can get better range. They can become more efficient.
But at the end of the day, if you're going to a dealership to learn about your
new car and you don't feel confident in how it's being spoken about or how your
(19:38):
new lifestyle is, you're probably not going to buy it.
Right. Right. And I think another thing to get past is price.
I've heard from a lot of people that, and dealers that I talk to on a regular
basis, like our transportation electrification board, we also have a dealer advisory board.
And we've been working with a group of dealers for over 10 years and we meet
(19:59):
on a quarterly basis and I bring these guys in from around the country and it
could range from somebody who has just a single point in one city to somebody
who's part of a larger dealer group represents multiple brands.
It is not lost on me that selling EVs has been very difficult for them just
because the way the numbers pencil, even with a lot of rebates.
(20:19):
And when you get into leasing, it just becomes untenable for many people.
You had probably the original wave of EV owners was they were largely the early
adopters, the technology buffs, people who wanted to be a part of that new technology
on the road to have that first EV.
And so you went through that and they'd maybe come back into the market one or two times.
(20:43):
And there's been a little bit of lift now because there's more to choose from.
It's not just one particular brand or one or two particular brands.
I think one of the data points I saw was that by 2027, there's going to be market parity in the industry,
meaning that you'll be able to go in and compare a nice vehicle to an EB vehicle
(21:03):
based on segment, trim level, technology.
Safety, range, price, all those other things that you look for right now when
you're out car shopping.
So that's going to be a very telling point for me.
But again, we've got a major opportunity, kind of a once-in-a-lifetime opportunity
that's sitting in front of us, and that's getting dealerships ready to bring
(21:26):
their customers in to buy the vehicle and keep servicing the vehicle there. there.
One thing that's not going to change, in my opinion, is customer loyalty is
going to remain critically important.
And ask any dealer right now how important it is to hold onto that customer
between purchases, because it's easy for them to go out and have their service done somewhere else.
(21:46):
But if you can keep that customer at the dealership to get their service done,
not just the warranty work that's going to be done there, but the non-warranty work,
it's really, It's really, really important to hold on to that customer over
the three to five to seven years, however long they're going to own that vehicle
so that they're coming back.
They have a relationship with the people in the dealership.
They trust the people in the dealership. They feel like they're being treated
(22:09):
fairly and they're going to want to come back and buy from that dealer again.
And I think that that's what we've really got to focus on.
With EV buyers is it's a new product and really the same old customer,
but you've got to be able to get that customer and give them a good experience right off the bat.
You know what I can't wait to see? I love that you touched on this is all about
(22:30):
loyalty and customer retention.
Look, I'm not a traditional car guy. I kind of came into this space from the
electrification side, but acknowledge how critical that is.
And I'm really curious to see The machine auto manufacturers do it right now.
They're using software. They're using the cloud to create some type of a loyalty experience.
Like to start, Tesla was offering free supercharging for a period of time.
(22:51):
And at the end of every quarter, they still do that right now,
offering some type of software discount. discount.
This past couple of weeks ago, I was getting blown up by Tesla where they were
asking if they wanted me to trade in my current Tesla and they were willing
to transfer my unlimited free
supercharging to my new car if I were to purchase by the end of the month.
And so there are other auto manufacturers that have the same opportunity to
(23:15):
do something very similar and car dealerships can do the same thing.
And I'm really curious to see what the adoption of that is. And I'm sure it's
something that Hugh and I are going to be working on together to convey how
potentially eventually they can use these things for attention and loyalty.
Next question for you, Terry. So look, like, you know, one thing I think is
so intriguing about you guys is, is related to the training that you're doing,
(23:37):
but it's not just, it's not just content focused.
It also has a component of technology as well.
And, you know, you have a bunch of millennials like me with a three second attention
span, but I think you're adjusting to the, these types of folks to provide a certain experience.
You want to talk a little bit bit about what you guys are doing in the training side?
Sure. Yeah. Training's always been a big, important part of our business and
(24:00):
we've been delivering training in the automotive space for decades.
We still do in a number of different channels or platforms.
So the way we really look at training right now is who's the audience,
what is it we're trying to get them to do, and what are the best methods for
having them retain all of the training that they have and and put it into practice
(24:22):
and be able to measure it and then show how taking training is improving the
other metrics that they've got in their job description.
So we still do a lot of in-dealership training. So on the non-technology side of the spectrum.
We've got people going into stores on a daily basis, 12 months a year,
and across multiple brands,
(24:42):
focusing on a number of different It could be anything from customer loyalty
to sales process to service work and customer sat based initiatives.
I feel like when we've got a facilitator or a coach in a dealership,
they're working a business plan with the general manager or the dealer principal,
(25:03):
and they're really focused on something that the manufacturers are trying to
drive performance around.
Now, technology plays a major role in the delivery of that. So we do a lot of web-based training.
We do a lot of micro learning that's delivered by cell. I feel like one of the
key parts is the sustainment piece.
So it's one thing to go through training and then you've done it.
(25:25):
You've kind of checked the box and I'm good till next year when I've got to
do this again to be certified or whatever the case might be.
But it's really the motion of having that ongoing perpetual sustainment so that
over time, the skills that you've learned just become part of your daily business
acumen and part of your routine.
And it's a retail performance agency, performance being the key word there is
(25:50):
we're always trying to strive to get people to do a better job.
And it's in their best interest because especially in the dealership world,
if you're selling more cars, you're making more money, right? Yeah.
I find this so interesting. It must be so difficult to track performance from
before you came to after you came.
(26:12):
What's your strategy on trying to show the dealership like, hey,
we're making a difference here and this is how to quantify it?
Well, I mean, one thing is control groups. The other thing is you take a look
at people who have taken the training, done well in the training,
consistently do the follow-up and look at the scores that are associated with them.
(26:32):
So if you're on the sales floor, you'll likely have an SSI score.
If you're in fixed operations, if you're in parts and service,
that CSI score is going to reflect on the service personnel that are back there.
I really think that the end-to-end delivery system, which is giving somebody,
first of all, making sure they understand what you want them to do,
(26:52):
get them to understand why it's important for them to excel in that,
give them the tools to be performing at a higher level, and then give them something to strive for.
And whether that's a recognition program or an incentive, those are traditional
tools in automotive that have worked really well.
And you've got to be able to appeal to your audience and make sure that they
(27:13):
stay motivated and they stay focused.
You know, it's also easy to go in and look at a dealer,
salesperson, or somebody in service who's underperforming and go in and have
an intervention in terms of giving them additional help or getting them the
additional coaching and focusing on, you know, what they might be deficient in.
And just keeping them motivated and giving them the right tools.
(27:35):
Was that the genesis of the Future of Automotive Retail Conference?
Was it to educate, I guess, the industry on the leadership of Maritz Automotive
and helping keep dealerships in the forefront, educating them?
Well, it was a couple of things. So the first time we did it was in 2016.
And we knew that there were a bunch of disruptive factors in the industry.
(27:59):
So EV was coming. It's certainly not where it is now, right?
But we knew that that was going to be a big disruptor.
Autonomous driving was the hot rage there for a little while.
We've seen that that hasn't really gone anywhere.
Ride sharing, where somebody has fractional ownership of a vehicle.
Nobody's ever going to buy a car anymore.
(28:19):
All you're going to do is you're going to have a subscription and on the weekends, you can go get an SUV.
And on the weekdays, you can drive a sports car or whatever,
and we'll bring it to your driveway.
Well, that hasn't worked either, right? People want to own their vehicles in this country.
And we looked at other things that were disruptive, like digital retailing and
(28:42):
lead generation and how the digital market was changing the way dealerships
operated. So that was 2016.
The focus was like, wow, all this stuff is happening.
How do you get your arms around it? What's going to be the most important?
Where do you need to it, make your investments, and how's it going to impact
your business in the long term?
The year after that, we really focused on people, human capital,
(29:05):
knowing that Maritz is a people company, right?
I talked about the fact we help our clients attract, engage,
and retain their best people.
That's really important in automotive based on the turnover that the industry is seeing over time.
It's expensive to bring new people in.
It's expensive to train them. You want to keep your high performers.
(29:26):
And regardless of how people want to buy cars or have their cars serviced,
having the right people in your dealership is always going to be important.
It's a differentiator. So we focused on that. That year after that,
we really focused most heavily on digital marketing.
So we did a deep dive on that. And the last year we did this,
(29:47):
it's what are the new retail trends?
And then really focused on EVs a lot because that seemed to be kind of the horse
that broke from the pack from when we had started.
But we just want to make sure that as we put these conferences on,
we bring in subject matter experts, we bring our team members in,
we bring our clients in, we bring dealers in.
(30:07):
And we think it's really kind of a cool atmosphere because you can have dealers
who represent all brands.
You can have clients who represent all brands.
You've got people who are very, very leading edge in the industry around specific
technologies or processes.
And it's information sharing and networking.
And that's what we found to be a very valuable use of our time.
(30:30):
Also allows us a little bit to show our expertise and our standing in the industry.
How do you expect it to evolve over time, the conference?
I mean, obviously, the advent of electric vehicles forced you guys to focus
on that a little bit more, but how do you see this materializing over the next
few years of what you're going to focus on?
Well, I think it's largely going to be market-driven.
(30:51):
Right. I mean, we started doing the conference every year and now we've gotten
into an every other year cadence only because you need a little bit of time,
a little bit of separation.
24 months isn't a long time, right? So it takes time for markets and trends to evolve.
I think technology is always going to be an important part of what we talk about,
how people interact with their dealerships.
(31:14):
I think attracting people and maintaining a great staff is always going to to
be important, that staff might change and their roles might change.
You're getting much more into people who are product experts than just,
you know, pure salespeople.
You know, in this year, we're going to be talking about big dynamic influences
and factors in the marketplace.
(31:35):
Is this crazy how much is going on right now?
I think you said that you're on like revision number 10 or something like that,
but to focus everybody and, you know, obviously everybody's attention spans.
You want to make sure that you're very clear and succinct and there's a specific
goal and you get your work cut out for you.
Yeah. I go back to what I said earlier, and that's dealers are going to be focused
(31:57):
on one thing as long as they're dealers.
They're going to be focused on selling cars, selling financing, parts and service.
I mean, they need to have those customers come in. They need to move vehicles every month.
So as much change as we see in this industry and it happens all the time. It's happening fast.
The fundamentals remain the same, right? It's about selling vehicles,
(32:18):
servicing vehicles, taking care of your customer, getting your customer back
in there, owning that customer over a lifetime.
The tools are different, right? There's data probably being at the forefront of that.
You've got new data tools, data insights.
You've got different ways to communicate with your customers.
Lead generation has changed dramatically, but they're there to sell cars.
(32:43):
Well, I'll ask you these last two questions here. So we named our company EV
Ready because we feel like there's a gap in the industry or in the world right
now that needs to be aligned between energy and automotive and other things that are electrifying.
And what you guys are focusing on is such a critical factor,
(33:04):
I think. It's going to sell more cars.
Dealerships are going to sell sell more cars when they're working with Merit,
if they build a plan together to get consumers confident in purchasing that electric car.
But talk a little bit about getting EV ready with Merit.
Yeah. I guess I would say maybe our common thread is with EV ready,
we're retail ready, right?
So we want our dealerships to be ready to perform at the highest level.
(33:28):
And I think when you and I started talking about what EV ready is doing,
what the mission is there, A lot of it is really focused around education and
engaging the dealers because this is a new model for them.
Having to put in infrastructure to support the vehicles that are on their lots,
support that inventory, support the service side of it.
(33:50):
There are requirements and there's compliance issues that the OEMs have with
their dealerships in terms of what they need to have physically installed into their dealerships.
That's the expertise that you guys bring.
I thought it was interesting because your expertise is certainly not ours,
nor do we want it to be. I mean, you guys have a very strong feel for that part of the business.
(34:11):
But once all of that is in, once all the infrastructure's in,
and they've made those big, huge capital investments.
I think it really is incumbent on a company like ours to make sure that the
people in the dealership understand how to talk about EV ownership and the training
that goes along with that. So that's kind of where I see the overlap.
(34:33):
Yeah, I kind of think about it like if you're looking at the balance sheet,
you're more on the revenue side. How do you sell more cars and wear more on the expense side?
How do you do it the right way? My last question for you is this.
Every time I talk to your team, I realize how well-rounded you are.
Initially, our conversations have always stemmed around these specific things
related to electrification, but I realize that you do so much more.
(34:55):
And so if you had a loud speaker for Maritz to explain high level,
what are some of the other key initiatives that you guys can manage or focus on for companies?
What is it that people don't know about Maritz? Well, like you said,
we're into a lot of things.
I'll always go back to saying we know who we are. We know who our clients are.
We know what we do for them, right? So helping them sell more vehicles,
(35:18):
parts and services, our mission, that's what we strive to do every single day.
We strive to help them create great experiences for their customers,
but we're also doing it in channels that I would call somewhat non-traditional.
So we launched a very important program on the EV side of the business in 2020
called the Clean Fuel Rewards Program in the state of California.
(35:39):
And that's a rebate program that we launched out there. Maybe I'd just take
a second and talk to you a little bit about that because that would be an area
where people really wouldn't realize that we have a footprint.
But in fact, we're running the largest rebate program in the country for the state of California.
So this is something we launched in conjunction with the California Air Resources
(36:03):
Board and utilities in the state of California.
And it's really to get people to understand the benefits of owning an electric
vehicle, where to buy those vehicles.
And there was a rebate involved in this program when we launched it in October of 2020.
So fast forward through June of 23, we basically had 98% of all the retailers
(36:27):
in the state of California with qualifying vehicles enrolled in the program.
So Maritz went out and did all those enrollments.
To date, we've had 386,000 plus customers awarded.
That was the equivalent of over $416 million in awards.
The average award for that was something like almost $1,100.
(36:48):
And then the measurement on CO2 metric ton save was 1.2 million.
So it's an important program for the state of California because,
you know, they are kind of the leaders in EV market share by a widespread.
But this was helping people in underserved communities, low-income communities,
(37:08):
or disadvantaged communities also take part in a rebate that would make the
vehicles more affordable.
Those vehicles were largely BEV or battery electric vehicles.
I think 325,000 out of the over 300 were BEV and about 62,000 were plug-in hybrids.
One other thing that we looked at was how's that breakdown by manufacturer?
(37:31):
No surprise that Tesla was the biggest percentage of vehicles just based on
market share in general, but they were followed by Toyota, BMW, Chevrolet, Hyundai.
And the electric companies that we worked with were, I mean,
the leading ones were Pacific Civic Gas and Electric, Southern California Edison,
San Diego Gas and Electric, the LA Department of Water and Power.
(37:53):
From a dealership standpoint, we had 117 Ford dealerships, 109 Toyota,
over 100 Chrysler and Chevrolet.
And like I said earlier, 98% of every dealership in the state was enrolled in this program.
We were going in and doing training in dealerships. So I talked about that earlier.
(38:14):
We have a group of trainers in the state that go in and work on the program
with these dealerships.
We do all the customer support. We did all of the creative.
We do the customer service center, the website, the actual auditing of the rebates
and the fulfillment of the rebates.
So that's an area where somebody would say, potentially, because I mean,
(38:37):
it's a fairly new thing, these EV rebates, but somebody would say,
I had no idea you did that.
And that's something we're really proud of because it's been a big,
very important program for us. And I think for the sales of electric vehicles
in the state of California.
Really interesting. It's like such a small bubble, but it really represents
the growth of EV in California. It's interesting that you guys did that.
(38:58):
Is there any other regions of the country that you see that are looking to do
similar programs right now?
Yeah, we've got a team. We actually built an EV agency that operates out of our LA office. office.
And they are working to identify states that have similar initiatives.
And we've had conversations or are working with several of those.
And it wouldn't surprise you to see that these are the ones that have the greatest
(39:22):
emphasis or the greatest market share.
California dominates, I think it's like 25% market share with EVs right now.
But you've also got some of the smile states along the coast.
I've never heard that. Texas, Oregon, Washington, even up in New England, New Jersey, New York.
So it's important for states who are trying to drive electric vehicle market
(39:46):
share to participate in some way in an incentive.
And oftentimes that incentive comes from the state or potentially could come from utilities as well.
Yeah, I think Maritz is going to have a part to play on the utility side,
on the infrastructure side related to some of the programs that are being released.
It seems like you'd be a good fit for that deal.
Yeah, I think so. I mean, we're in the car business and now the utilities and
(40:10):
the infrastructure companies are in the car business, whether they realize or not.
So we can kind of act as a conduit to facilitate that much the way we sit between
the manufacturers and the dealerships right now.
We understand the business and we understand the consumer.
So I think there's a lot from a communications and education standpoint where
we could add some value. you. Lots to be done. Just scratching the surface, right?
(40:32):
Yeah. You know, I think that's one of the challenges for me and where I kind
of go crazy thinking about the industry right now is there's just so much opportunity out there.
I think, you know, and I don't know the exact number, so I don't want to quote
it, but you hear about the amounts it's going to take to electrify and for the
utilities to move towards more sustainable energy sources in the trillions.
(40:54):
And there's just so much opportunity out there. It's just kind of like,
how do you figure out where to focus? Yeah.
Well, Terry, thanks so much for joining the podcast.
I really appreciate it. And I'm sure we'll have you on again at some point in
time as the industry continues to accelerate and things evolve,
but I appreciate you hopping on.
Yeah, I'm happy to do it. And we're really excited about working with you and EV Ready Energy.
(41:17):
It's a brave new world, right? There's a lot of stuff to do and we're looking
forward to partnering with you guys.
You got to have good partners and that's what we'll be.
Music.
Welcome to the EV Ready podcast, featuring industry leaders and their perspectives
on electrification, hosted by EV Ready Energy.
Hey, everybody. Welcome to the EV Ready podcast, and we're ringing in the new
year with Terry Irwin, SVP of Auto Sector Sales at Maritz Automotive.
(00:24):
Terry, thank you so much for taking the time. I do appreciate it.
Yep. Thanks for having me, Chris. Yeah. And I just want to give a background for everybody.
So Terry and I connected a little under a year ago.
I think it was at an auto manufacturers event and the relationship's kind of grown ever since.
But yeah, Terry, you mind telling the story about how that all kind of came about?
(00:44):
Sure. Yeah. Actually, I think the first time we met, you served as a panelist
and a guest speaker at a conference that we were running.
And that would have been, I guess, around 2022. 22.
And then at that point you were with ChargePoint.
And then last summer we ran into each other at a manufacturing conference for
their dealers that was focusing on fixed operations.
(01:05):
And you told me a little bit about what you're currently working on.
And it really piqued my interest because I think there's a lot of overlap with
what you're trying to do in terms of being in a dealership and kind of the education
and engagement element that's so important to get get dealerships ready to sell
and service electric vehicles.
Yeah, it's funny. For a second, I forgot about that. But obviously,
(01:28):
we're going to talk about that a little bit later today as well and the importance
of that conference and what you guys are putting together.
But yeah, I think education is obviously a huge challenge right now in the electrification space.
And I'm sure we're going to jump into that shortly.
And I think our intention is to figure out a way to help consumers feel a little
bit more confident about purchasing electric vehicles in the future.
(01:51):
But before we get into that, I just want to ask you a few questions.
So first, it's really interesting, even when we started initially speaking together
about some of the things we could do together, like admittedly,
I didn't fully understand ss and what it is and what your role was and what you focused on.
So tell us a little bit about that because I really do find it interesting.
(02:12):
Sure. Well, first of all, Maritz is a privately held company headquartered in
St. Louis, Missouri. And we've been around.
For about 128 years. And I've been around for a lot of that,
not all of it, but the last 30 years, I've been working for Maritz in a number of different roles.
And we're broken into three different companies. So we've got Maritz Engagement
(02:33):
Solutions, which focuses on things like loyalty marketing and incentives,
recognition, award-based programs in verticals like hospitality,
financial financial services, pharma, and a number of others.
We've got Maritz, what was called Maritz Global Events, which is now event
solutions, business event solutions.
(02:54):
And that's really our travel meetings, events, and incentive business.
And we do that across all of the verticals. And that would include things like
incentive travel, group business meetings, big events, things that our clients put on.
And those are largely for Fortune 500 companies. And then the third company
is Maritz Automotive Solutions.
So I'm the chief sales officer for the auto group.
(03:17):
And what we really have built our business around or modeled our business around
is becoming the industry's leading automotive retail performance agency.
And what that means is we focus on our clients who are the OEMs,
and we put together programs that are specifically implemented at the dealer body level.
And we have a number of different tools in our portfolio. So our solutions largely
(03:41):
are made up of things like incentives and recognition.
Training is a big part of our business, digital marketing, loyalty marketing.
We work with our sister company on meetings and vets and incentives.
And what we're trying to do primarily is drive positive behavior at the dealership.
And my 30-second pitch is we help our clients sell more vehicles, parts, and service.
(04:07):
And we focus on the people who are on the front lines in those dealerships,
making sure that they've got the tools that they need to be successful in their
jobs to drive things like SSI numbers and CSI numbers.
And we help them attract, engage and retain the very best employees.
You told me a stat once. I just think it was really interesting.
(04:27):
I think it was related to Maritz travel as to like how many hotels that you
book compared to the second. What is that stat?
Well, I'm not sure exactly what the stat is, but we have the largest hotel room
bookings by a factor of probably five.
I mean, we are constantly, every day of the year, moving people around to big
(04:48):
events, doing incentive travel with them.
In the auto industry, it's really interesting because it's a great fit for how
they traditionally go to work with their dealers. I mean, obviously they're
bringing out new products all the time.
We look at the product calendars and the launch calendars, and we are responsible
for executing a lot of dealer meetings.
So an example of that would be bringing in 2,000 to 3,000 dealers to a place
(05:12):
like Las Vegas, where we would handle everything from all of the hotel contracting,
all the logistics to the meeting event, the production,
the entertainment, things like that.
But primarily to get the dealers familiar with the business plans,
the marketing, and and the product launch sequence.
Yeah, I remember when I went to the Future of Automotive retail conference and you guys hosted that.
(05:34):
I didn't realize exactly what you did yet. I didn't realize what was happening,
what I was invited to. It was really well done.
It was really well done. And to hear that that's like a full-time thing isn't shocking.
I know this is going to be updated by the time this podcast is released,
but I'm going to the Consumer Electronics Show next week. And I know you guys
are hosting that one too. That's a pretty big one.
Yeah, we'll have a big presence there as well. Well, let's focus on the automotive piece of Merit.
(05:58):
So, you know, it's really interesting when I've tried to high level explain,
when I talk to people about Merit, I explain that you're an automotive performance
retail company and, you know, you gave your 30 second sales pitch.
I'd love to hear a little bit more than the 30-second sales pitch though,
like for the people who don't know what CSI stands for.
If you can give like a little bit more granular of what you're doing all day,
(06:21):
you know, what folks are on your team at your company, how you guys kind of
go to market, we'd love to hear that. Sure.
Okay. I guess maybe to give it a little more detailed picture.
First of all, CSI stands for Customer Satisfaction Index, and that's the surveys
and the data that comes back when people have their vehicle serviced at a dealership.
But SSI, I mentioned also Sales Satisfaction Index.
(06:42):
So customer goes in, buys a new vehicle. How is your experience at the dealership?
We're not in the research business anymore, but we're very much in the data insights business.
So we really look at how dealerships are performing, how the OEMs,
how the brands are trying to drive performance at the dealership.
And we kind of sit in the middle.
So we have a team that's deployed around the country. We've got automotive offices
(07:07):
in Detroit, Los Angeles, Plano, outside of Dallas, and in Nashville.
And we've got account teams there that are built largely of people who have
both OEM and retail experience.
So they've worked at a manufacturer or they've worked at a dealership.
So they really understand the dynamics of what happens when it's time for somebody
(07:28):
to sell a car or service a car. And then I would say where we really try to
focus is if you back up, we help our clients sell more vehicles, parts, and service.
We're putting together various types of programs that really make sure that
the people on the front line at the dealership understand objectives.
Have the tools to execute those objectives, and in many instances,
(07:52):
have some sort of a motivational factor.
So that could include an incentive or recognition for the dealership.
But SSI and CSI are important because those are critical KPIs,
benchmarks in the industry.
And we just feel like the better equipped an employee is, the better they're
going to do their job, the higher the performance levels are going to be.
(08:13):
Everything in automotive gets measured.
And also, the more likely they are to be successful in their job,
happy in their job, and remain in their job.
It's an industry that's traditionally had a lot of turnover at retail.
So we're focused on being the real powerful ally for the manufacturer because
we understand dealerships, how they work, and how they interact with their customers.
(08:36):
What's the state of how your business interacts with dealerships as it relates
to gas cars versus electric cars?
Does any of it overlap, completely separate?
How do you think about it? Let me make sure I understand the question.
What are the differences between selling electric cars and gas cars?
Yeah, like how does your company work with dealerships? Do you work with dealerships
(08:57):
differently depending on what types of cars they're selling?
I guess, I mean, there are nuances for sure. At the end of the day,
dealerships are all about selling new vehicles, right? They've got multiple revenue streams.
They're selling new vehicles, leasing new vehicles, getting people to come back
to do their servicing. They've got financing products.
So, I mean, there's a lot of ways a dealership can be making money and be profitable,
(09:21):
but we all know at the end of the day, they've got objectives to sell vehicles
every single a month, they get measured on a 30-day basis.
So whether it's a nice vehicle or an EV, there's still going to be a lot of
motivation to move those things.
Nobody wants any vehicle sitting on their lot for longer than they have to.
What we've tried to do is get a real strong perspective on what it takes to
(09:45):
be a successful EV dealership and what that means in terms of communicating
with a customer, attracting the right customer,
making sure that their buying experience is a good one, and then making sure
that they're really fully prepared for ownership.
Because we know that there are a lot of differences there, right?
Every time I've ever bought a car, an ICE vehicle, you pull out of the dealership
(10:07):
and you're kind of good to go at that point, right?
You can take your car back for service if you want.
There's a lot of other options in the aftermarket to service it.
But as long as I can find a gas station, I'm in good shape.
Now, when a consumer goes in and buys an EV for the first time,
there are a lot of other things that they'll have to understand for the first time,
including what kind of charging requirements are there, or can I put into my
(10:32):
home? What's the grid look like?
What's the usage of this vehicle going to look like for me? And ultimately,
I think one of the most confusing things is what's it actually going to cost me to run it?
I think there's a big misperception there around, hey, I'll never have to buy
gas again. So this car is really not going to cost me anything to run.
And people People don't understand electric consumption, demand consumption,
(10:55):
and that's a real opportunity for us to help educate not just the dealerships, but also consumers.
Yeah, yeah. And to your point, you mentioned it is about the consumers and helping
them, but it's also about dealer profitability.
It's about them understanding how the cloud ties to their vehicle now and how it ties to the utility.
(11:15):
So training now, I think, is partially about the consumer experience,
but would you agree agree that it's also, it's a little bit more than that too.
It's training for business owners as well.
Absolutely. Yeah. So we all know that there's been great advances in terms of.
The EB market and growth in market share. Obviously, it's much stronger in some
(11:36):
parts of the country than others.
However, everybody I talk to in the industry kind of acknowledges that the ship has sailed, right?
The investments that have been made over the last several years,
going back probably a lot more than just a couple of years, maybe over the last
10 years, have been significant.
Every major OEM, for the most part, is pursuing an EB strategy,
(11:58):
Many of which are going to, or at least profess to have only EV vehicles in their portfolio.
And there's some very aggressive benchmarks that are being set by the federal
government in terms of what they want to see in terms of overall market share.
So it's really critical that dealerships understand everything that goes into
the EV ecosystem and how they treat not just their customers when they come
(12:22):
in and are interested in an electric vehicle,
but what are the steps that you have to go through with dealership personnel
to make sure that they're properly trained on the sales aspect of that and the
servicing aspect of that? And really like cost of ownership.
I mean, there's a narrative there that they need to be able to be conversant with.
And also, there's a lot of unanswered questions because of all the complexities
(12:46):
around things like rebates and where those rebates come from and what qualifies and what doesn't.
None more than the IRA rebate of $7,500 per copy right now for vehicles sold.
That does not apply to many cars right now.
Isn't that crazy? Yeah. How few is it? I think I heard a number.
I don't know for sure. I heard it was like less than 10 cars qualify for the
(13:06):
test. I think that's right.
I think that's right. There was an article, I think it was in either last week's
Automotive News or the current one, where they really break it down.
And we're involved in really trying to help our clients and their dealers understand
where all that money comes from, what's available in terms of stacking incentives.
(13:27):
Until recently, there haven't been a lot of cash incentives on EVs because up
till, I don't know, six or nine months ago, the day's inventory was very low.
People were ordering those or pre-ordering those vehicles, taking delivery.
There wasn't a lot of inventory on lots.
Now, you're seeing that the day's supply is much longer, and I think you're
(13:48):
starting to see cash incentives that are going to be applying cash on the hood
incentives that than being applying to EVs, much like they have been to ICE vehicles in the past.
I heard a statistic recently. I think it was on Electrek that I read it from,
I think it was September,
relatively recently, where 50% of non-Tesla electric vehicle owners are considering
(14:10):
going back to gas or for their second car,
getting a gas car due to the experience that they're having, which is wild to me.
And I think we've all heard the reports about Ford not seeing the interest level
that they were expecting when they were initially looking to aggressively electrify.
Right. Your perspective, why do you think that is? Well, first of all,
(14:30):
in terms of the manufacturing commitments,
I mean, I think we've all seen things in the headlines about putting plans for
new battery plants on hold and kind of tapping the brakes on some investments.
However, there's still a pretty aggressive new product release coming out over
the next few years. So those vehicles have been designed and are being built
and are going to be hitting those showroom floors.
(14:51):
I think one of the big things that you touched on was really kind of the hurdle
around owning the car and not knowing how convenient it's going to be.
I mean, you can go to YouTube or watch the news almost any time,
and you'll be able to find people who are posting videos.
Their experiences of doing a road trip or reporters are getting in cars and
(15:13):
saying, I'm going to figure this out for myself.
There was a great article in the Wall Street Journal in 2023 about a couple
of women who tried to drive.
I think they were either going from New Orleans to Chicago or vice versa.
And the difficulty they had with plotting out their trip, getting to charging stations,
finding how many of those charging stations were not functional,
(15:35):
I've heard horror stories about people waiting forever to be able to go in and get a charge.
So that to me is a big hurdle that consumers are going to have to get over.
The whole grid piece, I think, is lagging the production and maybe some of the
consumer acceptance side of it.
There's a lot of things that you've got to plan for right now.
(15:58):
None of us ever thought about, boy, I don't know if I'm going to buy this ICE
vehicle because where am I going to find a gas station?
You know it's it's just a it's a non-starter what
i'm really curious to see over the next let's call it 10
years or so is right now like how close can utilities
understand auto manufacturers business auto
manufacturers under you understand utility business and then and how they can
(16:21):
connect with the consumer right um you know i think there's there's a little
bit of a a gap there in an opportunity for improvement and probably the other
third party is probably government it's it's It's the marriage of those three
that are going to make things easier.
And I think sometimes, to your point, sometimes you just go to charters and they don't work.
And I think Biden came out with funding recently. I don't know exactly what
(16:44):
the act was, but came out with funding for servicing and maintaining stations.
That's going to be a huge part of the future to gain consumer confidence again,
for sure. So I think that's part of it.
But then we've spoken so much. It's also about education.
Yeah. Yeah. Yeah. And just to kind of go back to your earlier point with what
we call the EV ecosystem.
(17:05):
So we have put together a transportation electrification board.
You'll know about that because you're a recent addition to our board and a very
valuable one, but we started this about almost two years ago.
And what was apparent to us is that there's a lot of players in and out that
connect to the consumer somehow when they buy an EV, right?
(17:27):
Used to just be the dealer pretty much. And now you've got, you touched on some of them.
You've got things like utilities. You've got government programs largely based
on rebates that are available to lower the cost of sale or ownership.
You've got infrastructure companies and you've got technology companies that
are really interacting, sitting
(17:49):
between an electric utility and the consumption of power in the vehicle.
So the consumer is touched by those in a lot of different ways, right? They are.
And I think the challenge right
now is they don't know that they are being touched by them sometimes.
You might be a business owner and you get an increase in your electric bill
(18:11):
and you think you have an energy efficiency problem.
You might get an increase at your electric bill at home and don't realize that
there's a certain rate that exists where you can get free electricity at nighttime
or discount electricity at nighttime.
I think once people realize the opportunities around electrification,
they're going to be a lot more excited about it when they see some of the things that are happening.
People don't know what they don't know, right? So they go out, they try something new.
(18:35):
And if everything feels normal, you don't hear from them.
If there's some type of a big problem, they get a loud microphone and they're
shouting from the rooftops. I think that's one of the challenges right now.
And I think the other big challenge that I don't really think anybody would
disagree with this, I don't really think the auto manufacturers would either,
is that there's an education challenge in dealerships right now.
And it's really nobody's fault.
(18:56):
I think it's just, you know, 2008, if you had a flip phone, it was a little
bit harder to sell a smartphone at the time.
And obviously, smartphones, they don't cost as much.
Adoption was quicker. Everybody had one. Everyone learned how to use it.
My two-year-old can look at pictures now on my phone.
Going electric isn't necessarily quite as intuitive. It's a little bit more
(19:16):
costly. The turnaround to get to your next car takes a little bit longer.
But I think that's the big opportunity right now in this space.
Infrastructure is a problem.
Hopefully, the cars can get better range. They can become more efficient.
But at the end of the day, if you're going to a dealership to learn about your
new car and you don't feel confident in how it's being spoken about or how your
(19:38):
new lifestyle is, you're probably not going to buy it.
Right. Right. And I think another thing to get past is price.
I've heard from a lot of people that, and dealers that I talk to on a regular
basis, like our transportation electrification board, we also have a dealer advisory board.
And we've been working with a group of dealers for over 10 years and we meet
(19:59):
on a quarterly basis and I bring these guys in from around the country and it
could range from somebody who has just a single point in one city to somebody
who's part of a larger dealer group represents multiple brands.
It is not lost on me that selling EVs has been very difficult for them just
because the way the numbers pencil, even with a lot of rebates.
(20:19):
And when you get into leasing, it just becomes untenable for many people.
You had probably the original wave of EV owners was they were largely the early
adopters, the technology buffs, people who wanted to be a part of that new technology
on the road to have that first EV.
And so you went through that and they'd maybe come back into the market one or two times.
(20:43):
And there's been a little bit of lift now because there's more to choose from.
It's not just one particular brand or one or two particular brands.
I think one of the data points I saw was that by 2027, there's going to be market parity in the industry,
meaning that you'll be able to go in and compare a nice vehicle to an EB vehicle
(21:03):
based on segment, trim level, technology.
Safety, range, price, all those other things that you look for right now when
you're out car shopping.
So that's going to be a very telling point for me.
But again, we've got a major opportunity, kind of a once-in-a-lifetime opportunity
that's sitting in front of us, and that's getting dealerships ready to bring
(21:26):
their customers in to buy the vehicle and keep servicing the vehicle there. there.
One thing that's not going to change, in my opinion, is customer loyalty is
going to remain critically important.
And ask any dealer right now how important it is to hold onto that customer
between purchases, because it's easy for them to go out and have their service done somewhere else.
(21:46):
But if you can keep that customer at the dealership to get their service done,
not just the warranty work that's going to be done there, but the non-warranty work,
it's really, It's really, really important to hold on to that customer over
the three to five to seven years, however long they're going to own that vehicle
so that they're coming back.
They have a relationship with the people in the dealership.
They trust the people in the dealership. They feel like they're being treated
(22:09):
fairly and they're going to want to come back and buy from that dealer again.
And I think that that's what we've really got to focus on.
With EV buyers is it's a new product and really the same old customer,
but you've got to be able to get that customer and give them a good experience right off the bat.
You know what I can't wait to see? I love that you touched on this is all about
(22:30):
loyalty and customer retention.
Look, I'm not a traditional car guy. I kind of came into this space from the
electrification side, but acknowledge how critical that is.
And I'm really curious to see The machine auto manufacturers do it right now.
They're using software. They're using the cloud to create some type of a loyalty experience.
Like to start, Tesla was offering free supercharging for a period of time.
(22:51):
And at the end of every quarter, they still do that right now,
offering some type of software discount. discount.
This past couple of weeks ago, I was getting blown up by Tesla where they were
asking if they wanted me to trade in my current Tesla and they were willing
to transfer my unlimited free
supercharging to my new car if I were to purchase by the end of the month.
And so there are other auto manufacturers that have the same opportunity to
(23:15):
do something very similar and car dealerships can do the same thing.
And I'm really curious to see what the adoption of that is. And I'm sure it's
something that Hugh and I are going to be working on together to convey how
potentially eventually they can use these things for attention and loyalty.
Next question for you, Terry. So look, like, you know, one thing I think is
so intriguing about you guys is, is related to the training that you're doing,
(23:37):
but it's not just, it's not just content focused.
It also has a component of technology as well.
And, you know, you have a bunch of millennials like me with a three second attention
span, but I think you're adjusting to the, these types of folks to provide a certain experience.
You want to talk a little bit bit about what you guys are doing in the training side?
Sure. Yeah. Training's always been a big, important part of our business and
(24:00):
we've been delivering training in the automotive space for decades.
We still do in a number of different channels or platforms.
So the way we really look at training right now is who's the audience,
what is it we're trying to get them to do, and what are the best methods for
having them retain all of the training that they have and and put it into practice
(24:22):
and be able to measure it and then show how taking training is improving the
other metrics that they've got in their job description.
So we still do a lot of in-dealership training. So on the non-technology side of the spectrum.
We've got people going into stores on a daily basis, 12 months a year,
and across multiple brands,
(24:42):
focusing on a number of different It could be anything from customer loyalty
to sales process to service work and customer sat based initiatives.
I feel like when we've got a facilitator or a coach in a dealership,
they're working a business plan with the general manager or the dealer principal,
(25:03):
and they're really focused on something that the manufacturers are trying to
drive performance around.
Now, technology plays a major role in the delivery of that. So we do a lot of web-based training.
We do a lot of micro learning that's delivered by cell. I feel like one of the
key parts is the sustainment piece.
So it's one thing to go through training and then you've done it.
(25:25):
You've kind of checked the box and I'm good till next year when I've got to
do this again to be certified or whatever the case might be.
But it's really the motion of having that ongoing perpetual sustainment so that
over time, the skills that you've learned just become part of your daily business
acumen and part of your routine.
And it's a retail performance agency, performance being the key word there is
(25:50):
we're always trying to strive to get people to do a better job.
And it's in their best interest because especially in the dealership world,
if you're selling more cars, you're making more money, right? Yeah.
I find this so interesting. It must be so difficult to track performance from
before you came to after you came.
(26:12):
What's your strategy on trying to show the dealership like, hey,
we're making a difference here and this is how to quantify it?
Well, I mean, one thing is control groups. The other thing is you take a look
at people who have taken the training, done well in the training,
consistently do the follow-up and look at the scores that are associated with them.
(26:32):
So if you're on the sales floor, you'll likely have an SSI score.
If you're in fixed operations, if you're in parts and service,
that CSI score is going to reflect on the service personnel that are back there.
I really think that the end-to-end delivery system, which is giving somebody,
first of all, making sure they understand what you want them to do,
(26:52):
get them to understand why it's important for them to excel in that,
give them the tools to be performing at a higher level, and then give them something to strive for.
And whether that's a recognition program or an incentive, those are traditional
tools in automotive that have worked really well.
And you've got to be able to appeal to your audience and make sure that they
(27:13):
stay motivated and they stay focused.
You know, it's also easy to go in and look at a dealer,
salesperson, or somebody in service who's underperforming and go in and have
an intervention in terms of giving them additional help or getting them the
additional coaching and focusing on, you know, what they might be deficient in.
And just keeping them motivated and giving them the right tools.
(27:35):
Was that the genesis of the Future of Automotive Retail Conference?
Was it to educate, I guess, the industry on the leadership of Maritz Automotive
and helping keep dealerships in the forefront, educating them?
Well, it was a couple of things. So the first time we did it was in 2016.
And we knew that there were a bunch of disruptive factors in the industry.
(27:59):
So EV was coming. It's certainly not where it is now, right?
But we knew that that was going to be a big disruptor.
Autonomous driving was the hot rage there for a little while.
We've seen that that hasn't really gone anywhere.
Ride sharing, where somebody has fractional ownership of a vehicle.
Nobody's ever going to buy a car anymore.
(28:19):
All you're going to do is you're going to have a subscription and on the weekends, you can go get an SUV.
And on the weekdays, you can drive a sports car or whatever,
and we'll bring it to your driveway.
Well, that hasn't worked either, right? People want to own their vehicles in this country.
And we looked at other things that were disruptive, like digital retailing and
(28:42):
lead generation and how the digital market was changing the way dealerships
operated. So that was 2016.
The focus was like, wow, all this stuff is happening.
How do you get your arms around it? What's going to be the most important?
Where do you need to it, make your investments, and how's it going to impact
your business in the long term?
The year after that, we really focused on people, human capital,
(29:05):
knowing that Maritz is a people company, right?
I talked about the fact we help our clients attract, engage,
and retain their best people.
That's really important in automotive based on the turnover that the industry is seeing over time.
It's expensive to bring new people in.
It's expensive to train them. You want to keep your high performers.
(29:26):
And regardless of how people want to buy cars or have their cars serviced,
having the right people in your dealership is always going to be important.
It's a differentiator. So we focused on that. That year after that,
we really focused most heavily on digital marketing.
So we did a deep dive on that. And the last year we did this,
(29:47):
it's what are the new retail trends?
And then really focused on EVs a lot because that seemed to be kind of the horse
that broke from the pack from when we had started.
But we just want to make sure that as we put these conferences on,
we bring in subject matter experts, we bring our team members in,
we bring our clients in, we bring dealers in.
(30:07):
And we think it's really kind of a cool atmosphere because you can have dealers
who represent all brands.
You can have clients who represent all brands.
You've got people who are very, very leading edge in the industry around specific
technologies or processes.
And it's information sharing and networking.
And that's what we found to be a very valuable use of our time.
(30:30):
Also allows us a little bit to show our expertise and our standing in the industry.
How do you expect it to evolve over time, the conference?
I mean, obviously, the advent of electric vehicles forced you guys to focus
on that a little bit more, but how do you see this materializing over the next
few years of what you're going to focus on?
Well, I think it's largely going to be market-driven.
(30:51):
Right. I mean, we started doing the conference every year and now we've gotten
into an every other year cadence only because you need a little bit of time,
a little bit of separation.
24 months isn't a long time, right? So it takes time for markets and trends to evolve.
I think technology is always going to be an important part of what we talk about,
how people interact with their dealerships.
(31:14):
I think attracting people and maintaining a great staff is always going to to
be important, that staff might change and their roles might change.
You're getting much more into people who are product experts than just,
you know, pure salespeople.
You know, in this year, we're going to be talking about big dynamic influences
and factors in the marketplace.
(31:35):
Is this crazy how much is going on right now?
I think you said that you're on like revision number 10 or something like that,
but to focus everybody and, you know, obviously everybody's attention spans.
You want to make sure that you're very clear and succinct and there's a specific
goal and you get your work cut out for you.
Yeah. I go back to what I said earlier, and that's dealers are going to be focused
(31:57):
on one thing as long as they're dealers.
They're going to be focused on selling cars, selling financing, parts and service.
I mean, they need to have those customers come in. They need to move vehicles every month.
So as much change as we see in this industry and it happens all the time. It's happening fast.
The fundamentals remain the same, right? It's about selling vehicles,
(32:18):
servicing vehicles, taking care of your customer, getting your customer back
in there, owning that customer over a lifetime.
The tools are different, right? There's data probably being at the forefront of that.
You've got new data tools, data insights.
You've got different ways to communicate with your customers.
Lead generation has changed dramatically, but they're there to sell cars.
(32:43):
Well, I'll ask you these last two questions here. So we named our company EV
Ready because we feel like there's a gap in the industry or in the world right
now that needs to be aligned between energy and automotive and other things that are electrifying.
And what you guys are focusing on is such a critical factor,
(33:04):
I think. It's going to sell more cars.
Dealerships are going to sell sell more cars when they're working with Merit,
if they build a plan together to get consumers confident in purchasing that electric car.
But talk a little bit about getting EV ready with Merit.
Yeah. I guess I would say maybe our common thread is with EV ready,
we're retail ready, right?
So we want our dealerships to be ready to perform at the highest level.
(33:28):
And I think when you and I started talking about what EV ready is doing,
what the mission is there, A lot of it is really focused around education and
engaging the dealers because this is a new model for them.
Having to put in infrastructure to support the vehicles that are on their lots,
support that inventory, support the service side of it.
(33:50):
There are requirements and there's compliance issues that the OEMs have with
their dealerships in terms of what they need to have physically installed into their dealerships.
That's the expertise that you guys bring.
I thought it was interesting because your expertise is certainly not ours,
nor do we want it to be. I mean, you guys have a very strong feel for that part of the business.
(34:11):
But once all of that is in, once all the infrastructure's in,
and they've made those big, huge capital investments.
I think it really is incumbent on a company like ours to make sure that the
people in the dealership understand how to talk about EV ownership and the training
that goes along with that. So that's kind of where I see the overlap.
(34:33):
Yeah, I kind of think about it like if you're looking at the balance sheet,
you're more on the revenue side. How do you sell more cars and wear more on the expense side?
How do you do it the right way? My last question for you is this.
Every time I talk to your team, I realize how well-rounded you are.
Initially, our conversations have always stemmed around these specific things
related to electrification, but I realize that you do so much more.
(34:55):
And so if you had a loud speaker for Maritz to explain high level,
what are some of the other key initiatives that you guys can manage or focus on for companies?
What is it that people don't know about Maritz? Well, like you said,
we're into a lot of things.
I'll always go back to saying we know who we are. We know who our clients are.
We know what we do for them, right? So helping them sell more vehicles,
(35:18):
parts and services, our mission, that's what we strive to do every single day.
We strive to help them create great experiences for their customers,
but we're also doing it in channels that I would call somewhat non-traditional.
So we launched a very important program on the EV side of the business in 2020
called the Clean Fuel Rewards Program in the state of California.
(35:39):
And that's a rebate program that we launched out there. Maybe I'd just take
a second and talk to you a little bit about that because that would be an area
where people really wouldn't realize that we have a footprint.
But in fact, we're running the largest rebate program in the country for the state of California.
So this is something we launched in conjunction with the California Air Resources
(36:03):
Board and utilities in the state of California.
And it's really to get people to understand the benefits of owning an electric
vehicle, where to buy those vehicles.
And there was a rebate involved in this program when we launched it in October of 2020.
So fast forward through June of 23, we basically had 98% of all the retailers
(36:27):
in the state of California with qualifying vehicles enrolled in the program.
So Maritz went out and did all those enrollments.
To date, we've had 386,000 plus customers awarded.
That was the equivalent of over $416 million in awards.
The average award for that was something like almost $1,100.
(36:48):
And then the measurement on CO2 metric ton save was 1.2 million.
So it's an important program for the state of California because,
you know, they are kind of the leaders in EV market share by a widespread.
But this was helping people in underserved communities, low-income communities,
(37:08):
or disadvantaged communities also take part in a rebate that would make the
vehicles more affordable.
Those vehicles were largely BEV or battery electric vehicles.
I think 325,000 out of the over 300 were BEV and about 62,000 were plug-in hybrids.
One other thing that we looked at was how's that breakdown by manufacturer?
(37:31):
No surprise that Tesla was the biggest percentage of vehicles just based on
market share in general, but they were followed by Toyota, BMW, Chevrolet, Hyundai.
And the electric companies that we worked with were, I mean,
the leading ones were Pacific Civic Gas and Electric, Southern California Edison,
San Diego Gas and Electric, the LA Department of Water and Power.
(37:53):
From a dealership standpoint, we had 117 Ford dealerships, 109 Toyota,
over 100 Chrysler and Chevrolet.
And like I said earlier, 98% of every dealership in the state was enrolled in this program.
We were going in and doing training in dealerships. So I talked about that earlier.
(38:14):
We have a group of trainers in the state that go in and work on the program
with these dealerships.
We do all the customer support. We did all of the creative.
We do the customer service center, the website, the actual auditing of the rebates
and the fulfillment of the rebates.
So that's an area where somebody would say, potentially, because I mean,
(38:37):
it's a fairly new thing, these EV rebates, but somebody would say,
I had no idea you did that.
And that's something we're really proud of because it's been a big,
very important program for us. And I think for the sales of electric vehicles
in the state of California.
Really interesting. It's like such a small bubble, but it really represents
the growth of EV in California. It's interesting that you guys did that.
(38:58):
Is there any other regions of the country that you see that are looking to do
similar programs right now?
Yeah, we've got a team. We actually built an EV agency that operates out of our LA office. office.
And they are working to identify states that have similar initiatives.
And we've had conversations or are working with several of those.
And it wouldn't surprise you to see that these are the ones that have the greatest
(39:22):
emphasis or the greatest market share.
California dominates, I think it's like 25% market share with EVs right now.
But you've also got some of the smile states along the coast.
I've never heard that. Texas, Oregon, Washington, even up in New England, New Jersey, New York.
So it's important for states who are trying to drive electric vehicle market
(39:46):
share to participate in some way in an incentive.
And oftentimes that incentive comes from the state or potentially could come from utilities as well.
Yeah, I think Maritz is going to have a part to play on the utility side,
on the infrastructure side related to some of the programs that are being released.
It seems like you'd be a good fit for that deal.
Yeah, I think so. I mean, we're in the car business and now the utilities and
(40:10):
the infrastructure companies are in the car business, whether they realize or not.
So we can kind of act as a conduit to facilitate that much the way we sit between
the manufacturers and the dealerships right now.
We understand the business and we understand the consumer.
So I think there's a lot from a communications and education standpoint where
we could add some value. you. Lots to be done. Just scratching the surface, right?
(40:32):
Yeah. You know, I think that's one of the challenges for me and where I kind
of go crazy thinking about the industry right now is there's just so much opportunity out there.
I think, you know, and I don't know the exact number, so I don't want to quote
it, but you hear about the amounts it's going to take to electrify and for the
utilities to move towards more sustainable energy sources in the trillions.
(40:54):
And there's just so much opportunity out there. It's just kind of like,
how do you figure out where to focus? Yeah.
Well, Terry, thanks so much for joining the podcast.
I really appreciate it. And I'm sure we'll have you on again at some point in
time as the industry continues to accelerate and things evolve,
but I appreciate you hopping on.
Yeah, I'm happy to do it. And we're really excited about working with you and EV Ready Energy.
(41:17):
It's a brave new world, right? There's a lot of stuff to do and we're looking
forward to partnering with you guys.
You got to have good partners and that's what we'll be.
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