In the latest installment of the annual Power 300 issue of Auto Remarketing, we go behind the scenes with some of the leading companies in the used-car space and their top executives with a few Q&A features.
Next up is Randy Kobat, who is the senior vice president and general manager of vAuto, HomeNet, iRecon and Dealertrack DMS at Cox Automotive.
Auto Remarketing: Given that you head up a wide base of products at Cox Automotive – vAuto, HomeNet, iRecon and Dealertrack DMS — what are some of big projects on your radar right now within that group?
Randy Kobat: Across the board, our primary focus is looking for ways to help dealers be more profitable and successful.
With vAuto, we recognize that the market has become much more transparent over the past decade, and especially in the past few years.
As we’ve been helping dealers that inventory management solutions, we have noted that the rise of transparency has also caused margins to decline. Therefore, we are evolving our used-car offerings to help dealers combat margin compression.
Randy Kobat, Cox Automotive
vAuto’s new Provision ProfitTime software allows us to provide a more granular understanding of the profit potential of every car in our clients’ inventories. These vehicle-specific, investment value insights can now help dealers manage their inventory like a market basket of goods — they know some goods are more valuable than others and, with this understanding of each vehicle’s, value on the day it hits the lot, dealers can use different strategies to retail every car. ProfitTime’s investment value-based methodology helps dealers go beyond managing every used vehicle the same way.
With HomeNet, the big theme is next-generation merchandising. Today’s buyers want a more engaging, immersive experience as they research and shop for vehicles online. We’re developing technology and tools, like SnapLot 360, that provide consumers the kind of content they want, and help dealers differentiate their vehicles from the competition and set the stage for a more frictionless online buying process.
I’m also really excited about the work we’re doing with Dealertrack. You might say that, in the past, the DMS drove the dealership. That is, dealers developed processes and workflows because they fit the way the DMS worked. Today, we know this has resulted in less-efficient and effective ways of doing business.
Dealertrack’s flexible platform doesn’t dictate how dealers do business. Rather, we’re using our implementation, and ongoing Performance Management, as an opportunity to help dealers identify and implement ways of doing business better, more efficiently and smarter. We are beginning to see that this transformational approach to DMS implementation and usage leads to enhanced dealership profitability, which is more important than ever in today’s retail environment.
AR: How does the tech-based evolution in automotive purchasing and ownership impact the Cox Automotive divisions/product lines you head up?
RK: The businesses I lead are aligned with other Cox Automotive units in our quest to help dealers “own the first click” on a new or used vehicle, and pave the path to a positive, digital retailing experience for customers.
We are also mindful that transportation as a service is gaining momentum, and we’re working closely with Cox Automotive’s Mobility division to ensure that our solutions and systems facilitate this opportunity for dealers.
On the dealership side, we know that industry consolidation will continue. That’s why we strive to ensure our technologies and solutions offer the flexibility, scalability and utility that will be required as we serve ever-larger dealership groups and enterprise-minded organizations.
AR: iRecon is the relative newcomer to the group. What do you think makes them stand out in the marketplace, and why are their services so crucial in used cars?
RK: I’ve spent the bulk of my nearly 30-year professional career in the car business. In all that time, dealers have continued to struggle with getting used vehicles retail ready in less time.
In today’s more efficient used vehicle market, the three to five days of a vehicle’s lifecycle that dealers lose to reconditioning costs more than ever.
We acquired iRecon to help dealers solve this perpetual challenge. The platform is unique in that it offers a two-way window for dealers to manage recon work stages, internal teams and vendors in the same place. iRecon fits perfectly with our philosophy of helping dealers retail used vehicles more efficiently and cost effectively to maximize profitability.
AR: Where are you seeing dealers innovate the most?
RK: Many dealers understand today that they’re not just competing with another store down the street, they are competing with the Carvanas and Vrooms of the world, as well as the experiences consumers get, and the expectations the experiences set, from non-automotive retailers.
I’m seeing more dealers apply this understanding in all corners of their dealerships. They are innovating how they acquire inventory, market and merchandise vehicles, sell vehicles online and in the showroom, serve customers in fixed operations and hire/manage their employees.
The pace of innovation is impressive, and it suggests a bright future for dealers and retail automotive.