Old-School Rizza Roars into the Digital Age

Post Date: 
05-19-2013
Driven by Gen Y, retailer embraces iPads, apps
 
In an age when auto dealers are plunging into digital tools for marketing, store management and customer retention, Chicago's Rizza Cars has become a star practitioner.
 
The six-store retailer with Ford, Lincoln, Acura, Buick, Cadillac, GMC, Kia and Porsche brands is a case study of a traditional dealership group transforming in a new era of operating technologies.
 
At Joe Rizza Ford Orland Park, the group recently instituted ADP Service EdgeSM, an ADP Dealer Services app that aims to speed service work and improve in-store communication.
 
Here's how it works: Service advisers photograph any problems on incoming vehicles. The technicians who will work on the vehicles receive the digital images on iPads, review the photos and use the iPads to order from the store's parts department, which makes needed parts ready as the vehicles arrive in the service bay.
 
That's typical of the tools Rizza Cars uses to increase efficiency and appeal to consumers who expect digital commerce, says Dan McMillan, CEO of the Orland Park Ford store and CFO of the dealership group, which sells about 450 new vehicles a month.
 
"The technology is just exploding," McMillan says. "You go to a seminar and think, man, this is the answer. And then something even better comes along.
 
"The common trend in all of it is consumer empowerment. The consumer has more information than he did in the past and we have to be ready.
 
"Be it good or bad, it's technology where we have to go," he says. "We don't have a choice."
 
Nine months ago, Rizza Cars launched a mobile app for customer smartphones developed by the vendor Dealerbug. The app enables customers to peruse Rizza Cars inventory, download owner manuals and watch videos that the group uploads to YouTube and other social media sites.
 
"It's the Y generation that's driving this," McMillan says. "This is how they want to do business. Everything is an app to them. They want to come into your store by hitting your app.
 
"And it doesn't hurt us just having our logo sitting there on their phone screen," he says. "We're always branding."
 
For perspective, flash back to the Rizza organization's earlier days.
 
Joe Rizza started the dealerships in 1978. He and his brother Tony Rizza, a partner in some of the Chicago-area stores, long prided themselves on being stubbornly old-school.
 
In a 1992 Automotive News visit to the used-car lot of their Rizza Chevrolet store, Tony Rizza held forth on the importance of dealers keeping track of every sale, customer and vehicle on the property. He demonstrated an amazing memory for names and details about every vehicle in his used inventory, and every nick and scratch anywhere on the vehicle.
 
To illustrate his accuracy, Rizza produced from his suit coat pocket a worn notebook of management notes. Written in pencil were the names of every customer and trade-in amounts for past sales. If any question arose, he would pull out the notebook and find his jottings about the issue in question to corroborate his memory.
 
Back to 2013, McMillan explains the organization's digital transformation.
 
"Now, instead of having all that information on a piece of paper, you've got an iPad, and you can use your dealer management system to look up inventory questions, service jobs and read through your customer list," says McMillan, who had been Joe Rizza's outside accountant before the dealer hired him as CFO in 1988.
 
"We decided we had to go this direction in the late 1990s when the Internet was becoming a big factor," he says. "And we needed to hire somebody who knew how to run Web sites, how to put your inventory on the Web site and how to post videos."
 

Growing Web presence

 
He hired Linda Tew as an Internet manager in 1999. At the time, the operation had only an AOL account and three nonfunctional Web sites. Today, Tew and her team of more than a dozen employees handle all of Rizza Cars' online activity.
 
"At least 20 percent of my time is devoted just to reputation management," Tew says. "Your reviews on DealerRater, Google and Yelp are more important than the manufacturers' CSI scores.
 
"Your customers don't really see your CSI scores. J.D. Power can talk about CSI all they want, but what consumers care about now is what they read online and how many five-star ratings you have."
 
Rizza's Orland Park Ford store was recently part of Ford Motor Co.'s pilot to use third-party reputation management vendor Digital Air Strike. Rizza Cars has now expanded Digital Air Strike to all of its franchises.
 
Mindful of the importance of positive reviews on consumer social sites, Rizza Cars has begun inviting customers -- while still in the store -- to post reviews using dealership iPads.
 
The salespeople don't push the requests if customers don't want to post reviews in the store, Tew says. But it is easier to get positive reviews when customers are completing their purchases than it is to follow up days or weeks later after the memory of the experience has faded, she says.
 
The Orland Park Ford store gets a couple of positive reviews a day this way.
 
"We've learned that a lot of customers are perfectly happy to write a review. But sometimes it can be a challenge, and once they're home, they just skip it," Tew says. "Some sites are more difficult than others. On Google+, for example, you have to have a G+ Page and a Gmail account. We appreciate any effort they can make."
 

70% digital

 
Rizza Cars is clearly in transition, and the group's marketing priorities have flipped.
 
Ten years ago, 65 percent of its marketing dollars were spent on traditional media such as newspapers and TV.
 
Today, 70 percent of the budget goes into digital activities, including search engine marketing and optimization, social media activity, Rizza Cars' internal Web site activity, YouTube videos, listings with AutoTrader.com, Cars.com, Kelley Blue Book and third-party reputation management, McMillan estimates.
 
The company churns out videos to elevate the Rizza name with search engine optimization tools. The dealership produces linkable pages with content focused on individual dealerships, including features on what defines a "master certified technician," and introducing the store technicians.
 
A recent conversation with McMillan found him fresh out of a video session to create spots to be uploaded to YouTube for the Porsche Cayman. Back at his desk, he pulled out a new iPhone he had just purchased for the boss, Rizza Cars owner Joe Rizza, and prepared to install the store's personalized dealer app onto it.
 
"The technology train has left the station, and retailing is never going to go back to the way it used to be," McMillan says. "We're pulling Joe and Tony along with that train.
 
"We all knew we had to change. You can't ignore Facebook and Twitter today," he says. "That's where your customers are. And that's one thing that hasn't changed in this business -- you've got to be wherever people are."
 
You can reach Lindsay Chappell at lchappell@crain.com.