How artificial intelligence can make data-driven decisions with customers in mind

It’s no small feat to turn a family-run dealership group in suburban Vancouver into a sophisticated, data-driven organization. It has taken dealer principal Adil Ahamed and his team at Destination Auto Group 10 years to get there.

A key aspect has been to mine both financial and customer data to make better decisions, aided by using an AI-driven financial planning and analysis tool, for example, Destination Auto Group receives “clear insight” weekly on its stores’ performance and has been able to make inventory and tactical adjustments much more quickly than it had in the past.

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Clearly the strategy is working. Ahamed’s accomplishments were recognized by the Canadian Automobile Dealers Association (CADA) when it named him the 2022 Laureate in Business Innovation “for initiatives that significantly enhance performance or broaden scope for new car and truck dealers.”

The winners were selected by independent judges from the Ivey Business School of Western University in London, Ont.

In the announcement, the judges cited “novel tools that enable data-driven decision-making. ... Innovations in information technology have greatly reduced the group’s average issue resolution time, which enables staff to focus on business growth.”

“We have an amazing team — very good human beings,” Ahamed said. “I share the award with them.”

BACKGROUND IN FINANCE

Ahamed joined Destination Auto Group in 2012 after earning his MBA from Columbia University in New York City and working internationally in microfinance and banking. His goal was to “unlock value through innovation” at the 363-employee group, which sells the Honda, Toyota and Mazda brands through four dealerships in Vancouver, North Vancouver and Burnaby.

Ahamed’s goal was twofold: Optimize the business and, should it decline, ensure that the real estate is growing in value. In 2016, he was named managing director of the group, and he became dealer principal in 2019.

“During COVID, we were able to speed up decision-making from weeks to a day,” Ahamed said. “It gave us the ability to proactively plan for various scenarios and execute in a manner that reflected our core values in managing our guests’ and associates’ concerns.”

The group has taken the use of AI past the familiar chatbots that pop up when a customer visits a dealership’s site, Ahamed said. Destination Auto mines and organizes its databases so it can use AI to suggest sales strategies and custom-tailored offers.

“The major challenge is to clean up the data. We’re trying to make sense of past data in a way that’s useful.

“The end goal is to have data that is relational” — that is, information that can help determine a customer’s wants and needs.

DATA DETAILS DELIVER

In sales, the detail becomes very granular, Ahamed said, recording when a customer bought a vehicle, what features appealed most to the customer, colour preferences and even features the buyer would have liked to have but were unavailable.

“We can send them information about future vehicles with those features,” Ahamed said.

AI can speed up vehicle purchases as buyers do more of the process online. But as the omnichannel approach evolves, Ahamed said, Destination Auto Group is balancing the use of AI with the all-important human touch. Omnichannel refers to technology and processes aimed at providing a seamless buying experience for consumers whether they shop online, in-store or both.

“In the auto business, the foundation is the real relationship with the guest,” he said.

Equally valuable is the use of AI in service applications. Ahamed is watching the development of technology that will provide drive-through diagnosis of a car and identify needed service, including tires, brakes and other components that wear out. The systems under development would message customers through an AI-enabled tool and allow the customer to choose which work to authorize.

Destination Auto is also exploring the use of AI to interact with vendors for seamless communications, Ahamed said, although he did not provide specifics on how such systems would work.

Ahamed said he reads business publications such as the Harvard Business Review voraciously and maintains contacts with his university peers to discover new ideas that will advance the business.