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The data battle in auto retail: Who’s losing, and how dealers can take control
Featuring Chad Rycenga, Chief Product Officer at Authenticom
Welcome to another edition of the Car Dealership Guy Podcast Recap newsletter.
Digital tools are only as good as the data that fuels them. That’s why in this episode of the CDG Podcast, Authenticom’s Chief Product Officer Chad Rycenga, breaks down why most dealers struggling with AI tools or marketing attribution don’t have a tech problem—they’ve got a data problem. And why fixing it doesn’t have to be complicated.
1. The true value of digital data is in the audience.
The people who will be best positioned to monetize from digital data are the people who have a better understanding of the audience.
“I think he (or she) who capitalizes and creates utility of their data in automotive and disciplines their data and uses that discipline data to help model and shape better experiences in the future will have an absolute leg up.”
This has held true for nearly every major tech/media revolution over the past 25 years.
2. One of the biggest challenges for dealers is the balancing act.
Many dealers feel hampered by the amount of liberty that they have with their digital data amid the security concerns associated with that date.
“The DMS (Dealer Management System) is in a tight spot…because…on one hand, they're actually there to be responsible and stewards of the data that they manage on behalf of the dealership. And…at the same time, the dealerships have need to be able to go ahead and free the data a bit to some of the vendors that they explicitly give rights to.”
The ability of dealers to be able to avoid security issues and explore other data opportunities is key to their digital strategies.
3. The tightrope in the digital data can yield major benefits.
A dealer’s success in this new age of digital data will lie in their ability to build partnerships with companies that adhere to the highest ethical standards when creating better services.
“That's sort of where I see we're at that sort of crossroads, that critical path, which is really interesting to see how…people in the DSP (Digital Signal Processing) space, specifically, are going to be able to go ahead and solve those problems and where vendors fill in those niches every step of the way.”
4. The business behind the business.
Authenticom focuses on the syndication of dealership data.
“That is the ability to extract the data from the dealer management systems and be able to go ahead and provide that data to approved vendors…That's the niche we operate within.”
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5. Dealers want more.
Listening to dealerships and their needs is an important part of the process.
“We find ourselves hearing more and more…,’What else? You've demonstrated the capability of being able to go ahead and sing syndicate the data. Now what else can you do for us?’ I call those instances of analytics.”
A lot of Authenticom’s clients are looking for insight on the parts of the business where there are opportunities.
6. A one-size-fits-all approach doesn’t always work.
Every dealer has different needs when it comes to the use cases for data—from extracting and assembling, to improving a dealer’s inventory management, to post-sales surveys.
“Regretfully, there's not like some big blanket statement we can throw over all dealerships that equally service them. They are having conversations with dealer groups about their objectives, their sales goals, their KPI and their metrics.”
7. Not all data is good data.
Having great processes to collect and secure data doesn’t guarantee the data is useable.
“We have a solution we call Record Recharge. In 2024, we did record recharge data appends for over 14 billion records. That is 14 billion records that we interrogated to try and enrich the data. Roughly 70 % of the data that we received of that was appended.”
There are a host of factors to consider when assessing which data is good and which data isn’t.
8. AI could be a game changer if steered in the right direction.
The capability of AI makes it highly resourceful in auto sales, but users need to think beyond the simple applications of the tech.
“If you can layer in some specific demographic information…on top of your CRM (Customer Relationship Management) because it's super rich and super clean data, the propensity models that you're able to…deliver to understand when somebody is probably in market versus not in market (for a car) are certainly far more valuable than just using anything that's off the shelf (with) AI.”
The real value of AI I auto sales will be the ability to move beyond the directional understanding of AI systems like ChatGPT and OpenAI.
9. The “80/20” play here is clear.
The most important part of the process in leveraging data to improve a dealer’s operations is to start the process.
“It's to understand the touchpoints, to be able to go ahead and rationalize the data in such a way that it helps basically put yourselves in a position to have the next conversation.”
The potential digital partners you choose to have those next conversations with will ultimately drive the level of return a dealership will garner from their data.
10. Next steps will come when you clean up the mess.
Getting clean data is the first step to building out a robust data business model.
“…Clean data leads to recommendation. The recommendation leads to reporting, ‘What worked; what didn't work; why did it work; why didn't it?’”
After that, it’s a matter of taking those pieces of information, making sure they are being appended, and relating it back to the clean data, so the business models can continue to be retrained.
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