Inside Automotive with Jim Fitzpatrick, powered by CBT News

The Future of Car Dealerships Depends on AI Integration

• Jim Fitzpatrick • Season 1 • Episode 5

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Brian Benstock and Jay Abraham explore how automotive retailers can leverage artificial intelligence and strategic thinking to transform their businesses and thrive amidst industry disruption.

• Origins of Benstock and Abraham's professional relationship dating back to the 1980s when Benstock attended Abraham's seminar on "how to sell anything to anybody"
• Three fundamental ways to increase sales: increase volume of transactions, increase amount per transaction, and increase frequency
• The danger of becoming "successfully stuck" in comfortable but limiting business practices
• Looking outside the automotive industry for innovative business models and customer experience approaches
• How incremental improvements across multiple business processes can yield exponential growth
• Why time has become more valuable than money for today's consumers, and how service pickup/delivery models capitalize on this shift
• Viewing AI as a tool for business expansion rather than merely cost reduction
• The importance of "funnel vision" - borrowing success approaches from outside the industry
• How to empower every team member with AI tools to create cumulative impact
• Starting with small AI implementations that generate revenue to fund larger innovation

For more insights on thriving in today's automotive retail environment, watch the full series of Thriving in Chaos with Brian Benstock and Jay Abraham exclusively on CBT News.


Jim Fitzpatrick:

You're watching Thriving in Chaos with Brian Benstock and Jay Abraham on CBT News. Welcome back to Thriving in Chaos, exclusively right here at CBT News. This is part two of our series, Thriving in Chaos with Brian Benstock and Jay Abraham. To kick off the series in part one, Brian shared his presentation of his vision for AI and the incredible impact it will have in the retail automotive industry. You can see that first segment here on the CBT News homepage.

Jim Fitzpatrick:

Now joining Brian and I for part two is Jay Abraham, top executive coach, business leader, founder and CEO of The

Jim Fitzpatrick:

Abraham Group and author as well. He has significantly increased the bottom lines of over 10,000 clients in more than 1,000 industries. Jay's here to dig deeper and respond to Brian's ideas on how dealers can unlock opportunities and thrive. Gentlemen, thank you so much for joining me on the show again today. Thank you, yeah, sure so, Jay, so happy to have you here. I know that you were listening in the control room as to what Brian and I were discussing and Brian's presentation was incredible. It was, as you know, as it always is Talk to us from your perspective, because you've helped, literally, as I said, in the opening thousands of businesses out there to increase their bottom line find new profit opportunities in their businesses. What's your take on Brian's comments today?

Jay Abraham:

It's quite profound. I like the word profound, Brian likes it too. If you'll let me, I'm going to give you a three-minute perspective before I answer, so that my approach isn't off-putting, okay. So my background is very interesting. I've gotten the very, very, very great privilege of looking at a thousand industries not businesses from many different vantage points on a worldwide basis and I've seen all the different ways people think and act and transact business model. Distribution sourcing can have the impact of a positive profit atom bomb if you're the first or the only one to apply it in your industry. So I come at everything from a vantage point more of a strategic thinker but of trying to look at not how everybody else does it in an industry, because the concept of a best practice sometimes is a very limited concept. It's the best practice for that industry. It has nothing to do with highest, best, most profitable, safest, fastest, most residual yielding alternative.

Brian Benstock:

It's just all that industry knows, Jay, when I first heard you say that, I thought of Michael Jordan. I think of Michael Jordan worrying about best practices. It's preposterous, right. He doesn't want to be doing the best practices, he wants to dominate, right?

Jay Abraham:

So it's a big difference at a situation from vantage points that are so much more externally focused and walking in the shoes of the recipient. So I've made about 20 pages of random notes, but I have to tell you some of them are going to be off the wall, so I'll spew them off in like tranches of three or four or five and stop and see if Brian wants to respond to some or go. That's the dumbest thought I've ever heard. Why are you sitting next to me?

Jim Fitzpatrick:

Let me ask you real quick, though, before you get started you guys are friends. You go way back. Talk to me about how you all got together.

Brian Benstock:

I'm going to age us both, Jay. I saw Jay speak in. I believe it was the Huntington Townhouse in the 80s and I'm a young manager and really an insecure manager.

Jay Abraham:

Because I've got this job.

Brian Benstock:

I'm 28 years old, how do I keep the job? And Jay's talking about how to sell anything to anybody. I think it was your book that you had come out with at the time and I wanted to sell anything to anybody at the time and I remember going to the seminar and one of the things he said was there's only three ways you can increase sales. And I thought, well, three things, I can do that.

Jim Fitzpatrick:

I can do three things.

Brian Benstock:

To increase the volume of sales, to increase the amount per transaction or to increase the frequency, and ideally you do all three Right and that was worth the price of admission there. I've used, I've tried to use those principles throughout my career. You talk about trade cycle management, of course, increasing the frequency and F&I and all the other things. So Jay's had a big impact. I bought a bunch of cassettes after that and then my world and Jay's world separated. I had enough.

Brian Benstock:

I went back to the store with the profound knowledge that Jay had. I read a couple of his books after that, but we got reintroduced on Clubhouse and I heard that Jay was speaking on Clubhouse. I said that, oh my God, I can call in. I called Jay and I told him this same story. That is fantastic. He said he remembered the seminar Not necessarily me, but he remembered the seminar, not necessarily me, but he remembered the seminar. And he said don't tell anybody because it ages me.

Jay Abraham:

There you go. We were there together.

Jim Fitzpatrick:

That's pretty cool.

Brian Benstock:

And we've been working together ever since.

Jay Abraham:

It's a privilege and an honor. A privilege and an honor. But yeah, I'll throw out some insights, and what I'm going to share probably aren't even in the right order. They were just random impressions, like Rorschach, that I got. So one of the things I'll start with is just a background.

Jay Abraham:

My training is in optionality, exponential performance and looking at an asset, whether it's tangible or intangible, in terms of how to get a lot more recurring yield out of it. So everything I say is going to be predicated on that, also on how to be preeminent, how to elevate the stature of your business, your people, to the role of the most trusted advisor, the only viable solution, better than the best, but somebody who they see having your best interest at heart. So I'm just going to go through and I'll do three or four and let Brian. So the first thing I remembered was, years ago, peter Drucker who died, but he was a really remarkable management consultant had a saying, and I'm going to probably do it a disservice, but paraphrasing. He said if you're not constantly committed to making what you do, how you do it, who you do and your business obsolete, you can rest assured there are plenty of people that are committed to do it to and for you.

Brian Benstock:

And I think that's a good starting point, good point, and I think that's never been more true in the automobile industry. You look at the number of manufacturers that are coming out China has over 200 manufacturers and you look at many billionaires now are getting into the manufacturing business here in this country. Jeff Bezos has announced that they're building a car and many of these other startups. So if we're going to be stuck with the status quo, we're going to be replaced by these people that are bringing a completely different perspective to our industry. Yeah, and so?

Jay Abraham:

that's got to be an overriding theme. The next thought that I have is that your process needs to be optimizing, maximizing and then multiplying. Optimizing means making whatever you're doing the best it can be. Maximizing is, let's call it, the biggest, most impactful from whatever your goals are financial or operational. And the last is how you can really go beyond that, and I think that's what Brian is talking about. I really like that. I'm going to see if he'll respond to this. I wrote down something that has been obsessing with me what are the rules for relevancy today? And you've got different audiences. I was working on a book a couple of years ago never finished it, but it was called Relevancy Rules and it was basically a play on words. It was that basically everything you do today in your, in your world life, business has to do with how relevant you are seen to the other side, and it's very dynamic. It's very dynamic and how it changes. So I'd love to get your perspective on that before I go on.

Brian Benstock:

Yeah, well, in marketing, I think you have to differentiate yourself from the competition. Differentiation is key, and then relevance is next right, because we could all wear pink skirts in the dealership and we've differentiated ourselves, but we're not relevant. And the third hurdle you have to cross is is it sustainable? You know, how do you come up with a way to differentiate yourself, how do you make that relevant to today's consumer, each consumer having different needs? And then how do you sustain that? And I think that AI can really help us do that better than we've ever had the opportunity to do it before, to be able to target the right message to the right customer at the right time.

Jay Abraham:

Good answer Get an A. So I was taught early in my life, way before data analysis and segmentation, that the data speaks, but you have to have to know the questions to ask it. So I'm just giving you a workshop?

Brian Benstock:

Well, I think that's true. That's always the interesting thing about's, say, a reverse risk, not reverse risk, well, reverse risk. Or when you look at a composite, let's say, from NCM, we can both look at the same composite or a financial statement and we see different things. And so it's not only observing the data, but being able to understand the data, and, as it's relevant to what you're looking to accomplish right, and what you spoke about just now is the query, the questions that you ask, and the deeper the understanding of the subject matter, the better the query, the better the query, the better outcome. Or, robin Sharma, you know better, better daily decisions, better daily decisions, better outcomes. That's really where we're at today. How do we come up with better outcomes? And it certainly starts by asking better questions.

Jay Abraham:

A good answer Again. A+, I'm a student, it's good, no, no, I'm just throwing these out. I mean, my job is to. I said this I'm not the AI guy, he's the play-by-play. I'm the color, I have a belief system and it's served me and my clients well, and I want to hear yours. I don't think anybody needs to compete on an equal playing field, but I think if they want to basically have sustainable advantage, they have to learn to think at a very different level.

Brian Benstock:

Well, that's true, and I think that's part of what we're talking about right now is to really I'm pushing myself to say, hey, we've done some great things. I'm telling the whole staff it's irrelevant. You know, we're in 2003, 23,. Number one in the country, so what?

Brian Benstock:

You know that's the meal that you ate a week ago. It's not serving you today and what would somebody do that? It's a really great question. What would you do to put yourself out of business? Because we all know our own Achilles tendon and what are the things that you would do? And I think what you said as you quoted Drucker, because you can best believe somebody else is trying to figure out how to put you out of business.

Brian Benstock:

That's right. And today the likes of Elon Musk are doing it, stella Lee are doing it, amazon may be doing it, that's right. Carbon is certainly trying to do it, so you've got a lot of forces there and a host of other people that are not yet in our industry that are looking at it.

Jim Fitzpatrick:

That's right, that's right, very good point.

Jay Abraham:

So the next thing I wrote down was just an insight, because I'm trained on levers and if you think about it in our personal life from who knows how long back, our life has been enhanced, it's been made easier and far richer by levers, whether it's a screwdriver, light switch, crank on a window, broom, push button for a door, pop top can. But I don't think people realize how many levers exist in a business that they're not pulling.

Brian Benstock:

You had asked me a lot of questions not too long ago about identifying the levers and the profound implication of improving each of these little levers by a small amount. And so if we said, can you and I used what you were talking about this morning, something about cost cutting, I want to get to a certain cost reduction at one of the stores and I said to the controller let's just take 3% off of all of these expenses right down and the impact of that will be really significant without, you know, brutally attacking the store. Many people, when they look at cutting costs in a dealership, jay, they look at personnel and advertising Right right, it's easy as lever to pull.

Brian Benstock:

And they're the two most important resources you've got. There are so many things you can cut, so I think that the levers, and having an understanding of those levers, is critical because, just as you can, by reducing costs with each of the levers, have a profound impact, by enhancing the performance on each of the levers, you can have a very exponential impact.

Jay Abraham:

So you know this. You may not, maybe you do. I've had this great fortune of helping over 300 world-class experts and none of them came to me for help with their expertise, but I had to learn a distillation, and one of them was the Deming organization. And that's where I learned the power of many incremental improvements combining to give you exponential, very safe, very predictable, very significant growth. And I'm telling you that because one of the notes I wrote was, as you're talking, the exponential capability is dramatically enhanced because you have five or six businesses you can do it with at the same time. That's where, to me, it's exhilarating.

Brian Benstock:

Within the existing business.

Jay Abraham:

Yeah, within the existing business.

Brian Benstock:

And you know I look at it. It's like a diamond. There's so many different facets on that.

Jay Abraham:

Great analogy.

Brian Benstock:

Each single one, you know, because we have a new desk manager and I was teaching him not to think small, to look at each of those different facets of the diamond being improved, whether it be the trade-in, the upfront growth the backend growth referral, every different aspect of it to maximize that particular opportunity, and I think he started to get it because he was thinking really in a binary way.

Brian Benstock:

It's more than just cost versus gross. There's so many other variables in there and it's fun again to be back working and I'm working again on the showroom floors. The chaos gets out there. I want to make sure I have an understanding and it's giving me a new perspective as I'm trying to integrate some of the AI solutions in with the modern-day person at a desk or on the showroom floor.

Jim Fitzpatrick:

Right, right, right. Yeah. That's always a great exercise whenever the GM or dealer— you can't do it from the ivory tower and we don't have an ivory tower, but you can get locked into your office and lose sight of what's going on 20 feet away from you? Yeah, Was that new desk manager? Did they come from the showroom floor?

Brian Benstock:

Yeah, he came from the showroom floor, but I think he was looking at things in a very limited way and I get it.

Brian Benstock:

And he's trying to play it safe. I get it. And today I found many of the people were too busy working with the computer and not listening and understanding what the head of the customer is and to be able to read the defense there. And I think that's you know. Any of us that have been pretty good at the desk understand that that's really where it's at. Just give me a yellow pad and a pen and I'm okay. Keep your computer.

Jay Abraham:

I love that. The next little note I made to myself was a question, because the biggest observation I've made when any kind of transformative or incremental change is required is it's really hard for people. They contemplate, they procrastinate, they equivocate, but taking action sometimes is a lot more effort. Taking action sometimes is a lot more effort. Ironically, procrastinating really is more energy, but how hard is it? You showed us those four examples of the agent and I'd ask you I'm setting you up for this, but did it take you a month to create that?

Brian Benstock:

No, it was pretty easy to create because when I looked at the team, their sales pitch, they were showing just the one call. And so you listen to a bot handle a sales call, and that in and of itself is not impressive. It is, but it's not. But as you start thinking about what that could lead to, that's where I think it becomes really interesting, if not profound, the thought that you could have thousands of calls being handled.

Brian Benstock:

So, as people are concerned about AI eliminating jobs, I'm thinking what if I could do a thousand more transactions a month? That's going to increase the amount of jobs that we have. It's going to increase the opportunities for all of us. It's going to increase the finance income, the used car income, the new car income, the parts income there, the finance income, the used car income, the new car income, the parts income there. And then the other part of that you have problems or difficulties hiring people overnight that are competent to answer the telephones, but now AI can have some solutions there, and so I think that it came to me when I was looking at it. The actual company that controlled that was thinking statically and I was thinking more expansively, and so I think that if we continue to do that. I think it will help us.

Jay Abraham:

So now I'm going to make just an interventional comment. For anybody watching when Brian talks about those bigger visions, you might go oh oh, I don't know that that's possible. I've studied what I'll call exponentiality how to take performance way beyond where you are, from time, effort, opportunity, access to the market, investment and capital, human capital, relational capital. And if anybody watching happens to be a mathematician and you want to study exponentiality and taking performance at least to exponential as opposed to beyond, there are five gradients that exist above exponentiality. I can't remember. They're like tetration, heptation, pentation. I can't. There's another.

Brian Benstock:

I'll take exponential people go, point is that people go.

Jay Abraham:

Oh, I couldn't do that. What I've found is many people and this is a time of chaos and transition but they can be thinking they're doing really well and you can actually be successfully stuck and you don't even know it because you don't know how much more yield you can get out of those assets called your business yeah, successfully stuck is key and I think we've all been there.

Jim Fitzpatrick:

Yeah.

Brian Benstock:

And you know good to great obviously addresses that. That you're, you're. You're not overwhelmed over joy, but you're, you're okay, and that's. I think that's. The biggest fear is that you get successfully stuck, and I think that's what we're looking at now. I'm running around Paragon like the British are coming. The British are coming to prepare for the unknown, uncertain times. So you've got to do what you can with what you've got in front of you and try and drown out the noise.

Jim Fitzpatrick:

Dave Anderson's got a line, a quote, that he says prosperity drains urgency, and it's so, so true, especially as we all came off in the industry making a ton of money during COVID and even still, to your point, dealerships are doing better now than they were in 2019. So sometimes it's hard to change the mindset of the dealer that says we're not going to cover off the bull with units and net profit.

Brian Benstock:

What's that saying? Dig your well before you're thirsty. And I think that that's really important for us to do right now, because tomorrow we could have a news headline God forbid that dramatically turns everything upside down.

Brian Benstock:

Something happens in Ukraine something happens in the Middle East, they could have a dramatic impact on us here, or something happens domestically, god forbid. So you know, I think we don't want to be smug, because you know what's that saying Be humble or be humbled, and we don't want to be humbled. I think this is a time for me personally and our team is. We're getting back to work, yeah, and really working hard, and I love the responsiveness. You know, a couple of people have checked out, said, yeah, this isn't for me, which is okay. And a couple of people say, hey, I like the attention. I'm glad you're back in it, ben Stock, so it's rewarding. That's good.

Jay Abraham:

I got a bigger list. So there's two variables that I'm going to introduce and they're similar. One is the power of what's called knowledge asymmetry, but understanding stuff from a vantage point nobody else does comma and acting on it. But there's also a counter to that and it's been called the alpha mindset. There's also a counter to that and it's been called the alpha mindset. It's committing to get outsized or asymmetric, upside out of everything you're doing, but de-risking the doubt. So I'm just throwing it out to see how you respond.

Brian Benstock:

Well, I think having profound knowledge has always been an advantage to any of us, and one of the ways that I think you talk about us getting that is taking a look outside the industry where somebody's doing that already, and then bringing it to your industry. You didn't have to create it, you didn't have to invent it, you just made it relevant to the industry that you're in. And I saw these brothers here that take companies in the US and they bring the same company to Europe and they change the name and they're having an incredible success. They just take the business model and change it and, in fact, one or two of the companies that they did that with partnered with them over this. That's great. We want to expand there and they've become, I think, billionaires doing that.

Brian Benstock:

So, you know, I think we're looking for and I'm really at the beginning of my career ways that I can do, things that would give me some insights, and one of the ways recently I went to Kazakhstan and I thought I was going to look at the past in the automobile industry and I happened to see the future. Wow, by going there. It was really a great, great insights to see the impact that the Chinese auto manufacturers are having on that industry and knowing that's coming here. So how do I set up our fishing nets, how do I set up our chessboard so that we can thrive in that next wave of competition, because the competition is not going to stop.

Jim Fitzpatrick:

It's not going to go away.

Brian Benstock:

And you can put tariffs there. There's going to be ways around it, I'm sure, so we have to prepare for that. That's right.

Jay Abraham:

I'm loving your answers, so the next thing I'm going to say is interesting. So I gave birth. You mentioned two areas that I love, and that's. I've got something that I created years ago and I think it's what you were alluding to. I call it funnel vision versus tunnel vision. What it means is you borrow success approaches from outside the industry where none of your competitors understand them. And you talked about Viagra and you talked about something else, but just to reinforce it.

Jay Abraham:

So fiber optics that literally transformed telecommunication did not come from telecommunication, it came from aerospace and was borrowed. You talked about the pen. Rogaine came from pimple medicine. Roland Dior had written that. You talked about the number one baby buggy. It manufactured. It does half a billion dollars. They borrowed the collapsible wheels from airplanes. Fedex would not exist, and neither would the whole industry, if Fred Smith didn't borrow what's called hub-and-spoke overnight instant processing that the Federal Reserve Bank uses. So there's plenty of precedent for looking outside, not inside, for breakthroughs. But that stated, I have a suggestion. You talked about agents, and I think it's in the beginning, but you can use an agent for two different things. You can have an agent constantly monitoring everyone to see what new innovative things your local, your national competitors are doing. But you can also have the agent monitor by category. You want to know about service, you want to know about follow-up, you want to know about anything anybody's doing. And the cost is almost going to be nothing to have that kind of outrageous intelligence, don't you think?

Brian Benstock:

Yeah, and I think life experiences can really open up the doors for us. Peter Lynch wrote a book many years ago.

Brian Benstock:

He was the founder of the Magellan Fund and he went up on Wall Street and I remember the book was in the 80s or 90s. But in the book he talked about using your life experience to make investing decisions. You go to the mall and there's a long line outside the gap. You may take a look at some of the stock. And he said isn't it ironic that many of the people that worked at these companies that are working day and night they're busy, busy, busy never invested $10 in the company? The answer was right there Apple. And when I read his book in fact way back when I bought a Macintosh SE and I read that book about that time and I invested a little bit of money in Apple at the time and I sold it- but I made a little bit of money.

Brian Benstock:

I got off the train way too early, but it made sense because using that little SE in the Excel spreadsheet that I'd never used before to monitor some properties I had, and it was a fantastic tool. And so I think you can use your life experiences. When you go to a Starbucks and you experience a checkout process, how can that be adapted to the dealership? When someone delivers something to you and there's a follow-up that thanks you for it, how can that be adapted when you have a great dentist that sends you a confirmation of an appointment we're all in the business of setting appointments you realize that was really great. That confirmation text was relevant, it was great, I was able to respond, it was responsive, it wasn't an auto thing, and would that help my show rate for appointments that we have in the dealership? So I think there was opportunities all around us.

Jay Abraham:

That's a great answer. So the next little scribble I had I have a very strong belief, and I've shared it with you I don't think I've shared it with you, jim that a business is very much like a hedge fund and in that business you have a lot of assets, tangible and intangible, and you have yield and you have risk, and most people don't really understand it, but there's a lot of assets. You don't think about Opportunities and asset efforts and asset interaction with people's an asset and all of them have variability. I was trained in variability. You do something one way, it's X. You do it another, it can be 2X. You do another, it can be 5X.

Jay Abraham:

And I'm obsessed with that because it's one thing to have a superior ad or sales approach, but you know this about me we've tested sometimes 30 ways of doing or saying something and one could outpull another by three or four times in terms of, and one could outpull another by three or four times in terms of closure, average sale profit, setting somebody else for the next, setting them up for the next. So I want you to sort of think about that. But I believe there's two kinds of business people 2D and 3D investors and I think a 2D is somebody who looks at revenue minus expense, equal static profit. And the 3D and I admire that, I think you're very much that they're looking at like a PE firm would or a real investor serious what's the ongoing yield we're going to get out of that asset? So comment on any or none of those, I don't care.

Brian Benstock:

Well, you know you mentioned many years ago to me you know how do you get. You know you've got the sunk cost of acquiring a customer and now it's how you maximize the opportunities within that sunk cost and it really changed the way that we looked at things. You look at your sales and service department. That customer is captured already and you've got an expense on ordinary sales of anywhere from $300 to $500 a car to capture a customer. What if you applied some of that to doing a better job with your internal customers, already Spending money?

Brian Benstock:

to resell the customer you've already got.

Brian Benstock:

Because that's the best customer you have. That's right. Best customer to have is the one you already have, no question. And you look at a company like Apple that has incredible retention. They're not spending the money on advertising new products but on retaining the existing products that they've got. And you know we have a pretty good return to market. At Paragon we're better than 50% for a metropolitan store. I'm told that's pretty good. But when you compare that to Amazon's return to market of 99% 99% thereabouts if their customers come back- you say wow, what an opportunity for us and that delta there, that 50 or 40-point delta for us, can be really significant Millions of dollars.

Jay Abraham:

It's fascinating, so I'm going to introduce a thought and then I'm going to ask you how it seems to relate, or whether it does. So. I learned earlier in my career that all buyers aren't worth the same, all sources aren't worth the same, all ads don't generate the same value, but most people aggregate them when they allocate a cost. So I want to spend $100 a lead. As opposed to that, this category of lead is going to be three times more profitable or twice as convertive as this, but I'm going to spend the same amount, so I'm throwing that out. But before you answer, I think with the AI and the predictability it's got, it can help you allocate and not generalize investment, because it's all about the yield you're getting on your investment and it's an aggregate of time who you align it with the recipient, the salespeople. So I'm giving you a complex comment.

Brian Benstock:

Well, I think it's absolutely right. You taught me a long time ago one of your tapes, when you talked about cell phones and you presented to the cell phone provider that the cost of the phone is $2,500, and at the time it was yeah, and you said how much is the average bill? And the average phone bill was about $800 at the time. So why don't you just give the phones away?

Jim Fitzpatrick:

And you put them on a contract. The money is in the bill.

Brian Benstock:

And so we actually did a campaign where we were giving away bag. It was a bag phone back in the it was in the 80s because, remember it, was at the time at bag phone and giving it away, and we absolutely crushed it.

Brian Benstock:

And understanding that the cost of us giving away the phone was negligible as it related to the cost of acquiring the customer. When it comes to campaigns and figuring out what the cost of the customer is, there are better customers than others. And figuring out what the cost of the customers are, there are better customers than others. So how do you use AI to mine the customers with the highest statistical probability of doing business with you now, at a higher churn rate and a higher gross profit? And if you present that query to the right intelligence, you're going to get those answers, and that exists now. I was talking with Danny from VinQ the other day.

Brian Benstock:

I said Danny how do we automate? Let's find out what cars return the quickest. Let's find out which cars give us the highest gross profit, and then let's get the number.

Jay Abraham:

There's a number and it's in the database.

Brian Benstock:

And then let's develop a strategy to reach out to those customers. And maybe Jay and this is what we're talking about here we reach out to those customers, we offer them a $5 oil change to drive them into the dealership and we spit the porter when they come in and we spit the service advisor. So now we're losing a fortune on that oil change.

Jay Abraham:

Well, perhaps, but it's an investment, if you're an investor.

Jim Fitzpatrick:

it happens, that's right.

Jay Abraham:

But yeah, you can probably I'm imagining use the AI to give you correlations. If you do this, you're going to get three times these people to buy, and it's six months, nine months. But I love that. I just thoroughly love that. I don't know.

Brian Benstock:

We did that, by the way, with Andrew Diff 100 years ago. He was working with us on Facebook and we spent $500. And the goal was to spend $500 and see what yields we could get out of $500. When you say $500, a head Total. Okay, total.

Brian Benstock:

It was Facebook and now privacy was a little different then, yeah, but we skimmed through the customers, a select group of customers, in our database. We shot to their Facebook accounts an unbelievable offer. And it's another thing how to sell anything to anybody. You have to have unbelievable offers. That are true. Irresistible offers, I think, is the word you used in the book. And we sent that irresistible offer out. We sold 60 cars for $500.

Brian Benstock:

That's incredible, and the amount of service we did and again, you can't replicate that today. But Facebook was showing off this case study and we're telling them stop, we don't want everybody doing that. But I think it was analogous to what's going on today. If you're hunting for fish with the right fish finders, you're going to have a better cat.

Jim Fitzpatrick:

You're going to catch more fish.

Brian Benstock:

I love that I have a better cat You're going to catch more fish.

Jay Abraham:

Of course, yeah, I love that. I have a belief system that business is analogous to billiards not pool, but billiards not with pockets and that every move is designed to set up the next and the next. But if you don't know the game you're really playing and you're playing a short game instead of a long, you're never going to win the match.

Brian Benstock:

Comment. I think that's where a lot of us dealers, myself included, struggle with really setting up the next shot. And the next shot and Billiards is I don't pretend to know the rules, but I do know you are One shot is setting up the next shot. And so how do you set that up? And I think we're getting there. And so how do you set that up? And I think we're getting there. In the analogy of the planes circling the airport.

Brian Benstock:

I think, if you don't think expansively for the moment, just say there's a 36-month lease. What would the optimal communication strategy be like with that customer during the lease? And, of course, thank you for your business. Thank you, was everything good? Hey, send us some customers so you've got referrals and, of course, do it better than that. But that's the initial communication. Let me set up your first appointment for service, and then it's three months. Let me check in. Is there anything else I can do for you? Hey, who else would be interested in your car? And have that. Set up the ideal 36-month communication strategy for that particular customer and then do that for all your customers. Right, have, have it automated. Automated, but have it where it's also custom, where it's referring to you with your name, it's referring to your car by its color and the mileage it's. It's it's personalized, and I think that's what everybody wants, right? It's customized scalability. Speak to me directly.

Jay Abraham:

I love that you set me up for a comment and I think it's a good question. You can also use AI to evaluate and rank probability of result, so you can say okay, not just if I send this communication, but here's seven different approaches. I'm contemplating which one will be the best. And if I want to do them in sequence, which one will be the best? Second, third, fourth, and why and how can I make it even more? You can do all that and it's just all you do is ask it.

Brian Benstock:

It's endless.

Jay Abraham:

Same.

Brian Benstock:

Thing with ads, the problems that you can solve. We now have a real, viable solution today, an intelligence that can give you the knowledge of the best automobile dealers in the country, an aggregate of all of them, to help solve the problems that we face in the dealership. And then go outside the industry and ask these questions.

Jim Fitzpatrick:

Which we can learn so much from, I mean in the industry. We always have those auto industry blinders on yeah, for sure. They say, oh, it's not going to work in the car business. You don't know my market, you don't know the auto industry, and meanwhile there's all of that, yeah, I used to say.

Brian Benstock:

when someone said you don't know my market, I'd say I know you have females and males, and I have males and females.

Jim Fitzpatrick:

That's hilarious, that's right.

Jay Abraham:

I love that. It's a very plebeian way of using AI. But in the course of a dealership and you've got I don't know 50, 100 employees, 200 employees, every day they probably have issues, challenges, questions, opportunities that they either are posed or they have. If every one of them just took one of those every day and posed it to whatever you loved whether it was chat, gtp, grok and you just got the answer and you pulled it, what would that be worth?

Brian Benstock:

yeah I.

Jay Abraham:

You know the cumulative effect of that could be pretty significant and and, and the goal is to make you a little bit better in every area. That was the whole thing from deming. If you have 10, 10 different facets, every process people don't realize every process has within it sub-processes, and if you can make every one of the sub-processes 5%, 10%, 15%, better, you can make the performance of that process hundreds better and the cumulative effect it's off the charts.

Brian Benstock:

Well, I think, while we're talking about all this intelligence and machines and processes, I think we have to remember also we're in the people business. That's right, and we have to humanize it for our people. We have to make them not afraid of the technology but to embrace and become warriors, champions with the technology. I think that when they can see an improvement, everything's with them. What's in it?

Brian Benstock:

for me, that's right If they can see that improvement in their own life and they see it in their wallet, in their pocketbook. They're going to have the trust. So true, because right now everyone's looking over their shoulder. What are you looking to do in my department? Oh, the DDC, you're going to replace me with this. No, we don't want to replace you with the machine, I don't want the assisting us. And think of what you can do in a service department if you can make it easier for people to do business. We've had some good success. I think we're just at the beginning of the success that's available to us. That's right, and eliminate the need for customers to have to come to the dealership altogether for service or for anything. I mean when we think of again. We can take a picture and it's developed. You used to have to go to a photo place and drive there and drop the film off and come back.

Brian Benstock:

And so we were going through the sales process. We said, what if the best sales process is the elimination of the process altogether? We had this shopping cart analogy. And you think of when you go to a supermarket and I've done it, not anymore, but I've done it and you take the shopping cart, you get a shopping cart, you go inside and you start loading up the shopping cart and you walk through each aisle and it's designed where you have to go through every alley, just about every aisle, and you load up the shopping cart and then you go to checkout. Now what do you do? Well, you unload the shopping cart, right. You unload the shopping cart and you pay. Then what do you do? You reload the shopping cart, right, and you go out to your car. Then, what do you do? You unload the shopping cart. Then, what do you do? You go home and then you unload the car or you can communicate with Whole Foods online and have it delivered to your front door.

Brian Benstock:

And I tell this story. I was at NYU taking a disruptive thinking class and they were asking us to redesign the shopping cart. This is how the whole story came out. And I drew a box, and I drew another box, and I drew an arrow, and we had artists in the class. They were drawing these beautiful shopping carts that had refrigerated areas. And the professor looked at this and said what is this? And I said well, this is my design. We designed the shopping cart. You call from your home and you have the food delivered directly to your house. He said but that wasn't the assignment. I said but it's the solution. And he sort of blew it off. And God strike me that a week later, amazon bought whole foods for 28 billion dollars.

Jay Abraham:

I sent him the picture of the show I said it's not a bad idea, right, but but you know, perhaps the best uh improvement in the sales process is its elimination.

Brian Benstock:

Yeah, you know, to make it just easy for people to point, click, buy right and then eventually just use voice.

Jim Fitzpatrick:

I want this delivered to my front door and we've seen disruptors such as Carbana and Vroom, which I'm arguably not around anymore, but we have seen those disruptors come in where somebody can then click buy the car, not test drive it yet have it delivered to them all the financing is done and away they go.

Brian Benstock:

But use your life experience. I've purchased cars that are not Hondas, right, and I've never gone to a dealership, except once recently. I just bought a car, yeah, but never go to the dealership. Just have it shipped to my house, yeah, and so if I want that, so do other people. That's right. I don't go to a dealership for service. Yeah, pick it up. I can't be sitting in a lobby reading a newspaper or magazine or texting on my phone. Just pick it up.

Brian Benstock:

Ninety-seven percent of the time we're not driving our car, so make better use of that time and I think, if we can do that in every facet of what we're doing, just make it easier for people to do business. I think you'll do a lot more business. That's right. That's right.

Jay Abraham:

I love those answers. I'm going to some of the things I'm going to say you're going to have fun with.

Brian Benstock:

So you talked about your hypothetical roundtable back then. That's right out of Think and Grow Rich.

Jay Abraham:

You got your master group, yeah, but here's the. With AI, you can say how would Jeff Bezos address this? How would Einstein address this?

Brian Benstock:

I'm afraid of the answer Get rid of those dealers.

Jay Abraham:

But it will basically research.

Jim Fitzpatrick:

It will formulate mindset.

Jay Abraham:

It will address it and give you an answer.

Brian Benstock:

Now even if that answer isn't what you want, the whole key to everything is opening up your world for thought starters right, and we had so many bad ideas around pickup and delivery, you know, but they led us to the good idea. Yeah, and I was just recently telling a young colleague of mine, you know, because sometimes he would be restrictive and I said, when you whiteboard things, everything's good. Jim, we're gonna make this guy that we want to fire, we're going to make him the president of the company. Wow, that's ridiculous, let's see where it takes us. And we're going to do that and put it all on the whiteboard. And many times the initial ideas are terrible but they lead you to the right idea. And that's what had happened. We were going to have four garages in the city. We were going to have four garages in the city. We were going to have customers drop the cars off at the garage. We were going to have a truck pick up the cars and, as you're describing, it's ridiculous but it led us to.

Brian Benstock:

What would Scholz do? Because there was a Honda dealership in the customers in Manhattan better than the dealer was able to service it while he had a store there, and we wanted to not just adequately do it. How could we do a better job? And it was. Where would we put the Honda dealership, our imaginary Honda dealership, and it was one on every corner. And how could we do that? Right? And it led to the cell phone. Put the dealership on the cell phone, pick up the car and you know you had the naysayers within my group saying it's going to cost too much. But you know there were a lot of things that we learned from doing that. The average repair order was double when we picked it up because we, you know, and people said I don't understand that American Honda didn't understand it. They said, well, that's because there were a lot of lapsed customers. But two, three years later the oil is still going, you're still doing it, yeah.

Brian Benstock:

And then you walk somebody through and you say you've waited 45 minutes to get your car written up. You're waiting in the lobby for 45 minutes. You've got the car up in the lift and they say, jim, in addition to your oil change, you need brakes. Jim has two questions. How?

Jim Fitzpatrick:

much and how fast.

Brian Benstock:

How much and how long, exactly that. And so we've taken the time out of the equation, and time is more valuable than money today. If you can save me time, I'll pay you more money. That's right, and in our case what happened was customers don't reject services necessary when we've got the car and not tying up their time, they're more than happy to get it done.

Jim Fitzpatrick:

They'll still ask how much hey, I need a discount than happy to get it done. Some of those still ask how much, hey, I need a discount.

Brian Benstock:

It's fair, Sure, but they're more likely to give us the okay Right. And I think that was another area where we were losing the independence. Because we diagnosed the car. The guy says get me out of here. They'd go home, realize they needed that work and they'd just drop it off at their local gas station and get it done Right.

Brian Benstock:

So I think there was a lot of learnings that we got. It was a return on learning ROL that we were able to get by making it easier. We thought the benefit was going to be in retention of customers. We never dreamed it would be in the profitability.

Jay Abraham:

That is so profound. So there's a subtlety that you sort of throw away that I don't think most of the people watching Brian's discussion with me and his comments earlier will grasp. So you have probably all your life gone outside for expanded knowledge you talked about. You were at NYU. I happen to know that you put a lot of money out and you and your team went to Harvard to learn about macro AI. You read books all the time. I want to get you to comment on that, because I think a lot of people don't want to travel outside of their comfort zone.

Brian Benstock:

It wasn't Harvard, it was MIT. We took a very intense course in AI through MIT and it was scary because it was telling you this is where this is all going, and it made me realize how far behind we were. Murat Deljanin and I both separately took the course and it was great because you literally had to put an hour and a half a day in. And on Tuesday was test day and I said to my wife I'm too old for this stuff, I'm cram old for this stuff.

Jim Fitzpatrick:

What am I doing?

Brian Benstock:

I'm cramming for a test, but A a couple of again learnings from the learning. It's great to have a deadline, so you learn for the week and you've got to test and you've got to make sure you've got the knowledge for the deadline. It's also exciting to get that additional knowledge, but the challenge there is like anything else the more you learn, the more you realize you don't know. That's right, and I'm somewhat overwhelmed by the opportunities and that's why I'm here. I'm here looking for AI solutions.

Brian Benstock:

I hope there's somebody from outside the auto industry that says I can help that guy and reaches out to me and says, hey, why don't you, let's get together on this Sure, and and reaches out to me and says, hey, why don't you? You know, let's get together on this Sure and let's build this together. My company does and I've reached out to a couple of companies, but it's finding the right balance to develop some of this with and we're having some fun with outbound calls being made by bots Okay. To customers that have open recalls Okay, and the success has been pretty good Is it really.

Brian Benstock:

Yeah, that have open recalls Okay and the success has been pretty good, is it really? Yeah, you realize that every one of us has open recalls and how do? We develop technology to be able to reach out and cost-effectively handle those calls Sure. That's exciting.

Jay Abraham:

I like that. I'm almost done, thank goodness.

Brian Benstock:

You took a lot of notes.

Jay Abraham:

I did so I want to make a comment which is going to be counter to what you're saying, but it's going to feed what you're saying. So most people think that a breakthrough has to be tectonic, it has to be upending the business, and that's what you're advocating. But in order to get there, sometimes it can be expensive, time-consuming. People don't realize that you have residing in any business and, I think, in a dealership more so. The ability to apply breakthrough lenses on everything from how you get you call it an up a lead, a prospect, how you close them, what you do afterwards, your sales, your marketing, your strategy, your business, and all those can be done to free up a lot more revenue that can fund all this transition.

Brian Benstock:

Well, I think that's well said. You know, if you look at Apple, they were a computer company, right, and it was their decision to go outside of computers that made them go from a $100 billion to $1 trillion corporations and you've got to keep your core business model strong.

Brian Benstock:

That gives you, in fact, enhance that so it throws off additional revenue, so that you can have your disruptive growth solution, your disruptive business model and, like I said, keep that core going strong, as you have this disruptive team, the Skunk Works team developing it, and eventually Apple's disruptive technologies like the iPod and the cell phone take over and eclipse the computer business, which was once their core. And so what if Paragon's AI division starts out small? And we start out small? All of a sudden we start asking great questions like I have 753 Hondas, how can I sell them in 24 hours for a 3% margin? And the AI gives what if it gave me the solution to be able to do that? And all of a sudden we order another 700 cars. We order another 700 cars. So it is where you start out incrementally right and it's not earth shattering.

Brian Benstock:

A couple of guys were talking to me about the Amazon project where they started selling cars through Hyundai. We saw something that they sold six cars or something like that. A friend said see, it's not so easy. I said, no, don't. If they can learn to sell one, they can learn to sell 6,000. That's right 600,000.

Brian Benstock:

That's right. So it's incremental. Yeah, learn how to do it. Learn how to do it right. It doesn't have to be devastatingly popular overnight. Yeah, it's just getting that started and that's a Galloway quote.

Jim Fitzpatrick:

I love it.

Brian Benstock:

It's amazing how long things take and shocking how fast they happen. That's what happens.

Jay Abraham:

I'm going to stop with the next comment. I've got five more pages, but I probably beat you up enough. I like to reframe things or change the semantic way somebody looks at it. So I'm going to ask a question of everybody and for you, and I'm going to try to contextualize it so it makes sense. So the question is what is your and your team's time worth? And I don't mean what you're paying them. What is it worth now? How much do you want it to be worth? They don't have 24-7.

Brian Benstock:

They only have 24-7.

Jay Abraham:

They don't have that great of intellectual superiority. How are you going to get them and their time to be worth more, so that your payoff is worth more? So that's my ending comment, and you can address it any way you want or not.

Brian Benstock:

I may not give you the answer that you want to hear.

Jay Abraham:

I have no expectation.

Brian Benstock:

I think the biggest upside for us at the dealership is for us to figure out how to put intelligence in every associate's hands, every employee's hands every vendor's hands that works for Paragon, and the cumulative effect of having this intelligence in a tangible way in the hands of our 500 employees, or 470 employees, I think could be really massive for the dealership, and not just they're going to have access to it. But you know, again it's like having the Internet and looking at cat videos. No, no, we want to say, hey, how do you make your job better with AI? And to really put that in people's hands and empower them to be able to make decisions. And I've got a long way to go to be a better leader, to lead in this new direction, to really cultivate the brainpower of all of our people. I was at a meeting for a team and.

Brian Benstock:

I watched the leaders of the company sit back and they conducted the Monday morning meeting. It wasn't Monday morning, it was Wednesday and they let the employees run the meeting and they had a facilitator and the facilitator went to each of the departments and said what's your big win for today? And Sarah stood up and said we had a customer who was really upset and we solved it and we resolved it Half the time it would normally be, yeah, yeah, everyone collapsed and they went around the room with things like that and I'm sitting there and saying it's so basic but it's so impactful that they were talking each other up and I love that young skunkworks, entrepreneur kind of attitude and I think that if we can have that at our age I'm 64, if I can be like a startup and behave like a startup, I think that would be very good for our dealerships.

Jim Fitzpatrick:

Yeah, yeah, no question about it.

Jay Abraham:

I'm down.

Jim Fitzpatrick:

Yep, Brian Benstock and Jay Abraham. Thank you so much for joining me on the show, Jay, thank you.

Brian Benstock:

Thank you for the segment of thriving in chaos.

Jim Fitzpatrick:

I know that our dealer community is going to get a lot out of your visit with us here today, so thank you so much. They should reach out.

Brian Benstock:

They should reach out to Jay. He's a wealth of knowledge, there's no question about it.

Jay Abraham:

He's a he's a book on a shelf that I read often.

Jim Fitzpatrick:

Thank you, sir. Well, thank you. Thanks to both. Of you really appreciate it. Thank you Thanks for watching thriving in chaos on CBT news.