Brand equity is an important part of profitability, say presenters at a recent Auto Pride event.
TUCSON, Ariz. — "Why would you spend any money to protect something you can't put your finger on?" asks Bill Wade, of Wade and Partners, at the recent Auto Pride/Independent Warehouse Distributors (IWD) annual membership meeting. But protecting a brand, he adds, "is the most important thing you've got."
Maintaining a brand's equity may be difficult to measure, but it's vital to suppliers and distributors. In today's price-focused marketplace, it can be all too easy to let a premium brand's equity diminish, and distributors have spoken out about the need to hold on to a premium product's value.
To see the relevance of brand equity, one need look no further than such powerhouse companies as Coca-Cola, whose brand is valued at around $55 billion, and Toyota, which carries an almost $26 billion brand, says Terry Smith, from the Brand Protection Group, who spoke to suppliers at the event.
A large obstacle to keeping a brand afloat in today's market is brand piracy, says Smith. He emphasizes that companies need to be proactive in seeking out brand pirates before the problem becomes too massive.
Having a sizeable staff of employees whose sole jobs are to scour the world for incidences of piracy and counterfeiting is key.
Lest distributors think this is a supplier-only problem, all links in the aftermarket supply chain should be stalwart in looking out for brand piracy, according to presenters at the Auto Pride meeting.
"It's unquestionably a distributor concern as well," says Bill Burns, executive vice president of IWD/Auto Pride.
In fact, the group recently established trademarks for its Auto Pride and Truck Pride brands in Mexico, he adds.
Labor warranties for distributors?
Also at the meeting, Auto Pride's Automotive Service Expert of the Year, Vincent D'Antuono, from Pullen's Garage in Hamilton, N.J., told program group members that a labor warranty would be beneficial for repair partners, boosting consumer confidence in the aftermarket channels.
"You have a competitive edge if you can offer a warranty to your customers," he says.
The statement was met with some disapproval from attendees, who say many manufacturers already offer labor warranties for their parts, and D'Antuono represents a minority of repair shop customers who would be willing to pay an incremental increase for parts to ensure the labor-intensive items are under warranty.
Speaking after the membership meeting, D'Antuono says a national warranty of this sort would encourage parts distributors in his area to join Auto Pride.
Himself a crossover from the dealership realm, D'Antuono offers a one-year, 12,000-mile part warranty to his customers. Other elements he incorporates into his business from his dealership days are clean waiting areas and employee uniforms.
As far as what he charges for parts, D'Antuono says he likes to mainly stay with the dealer list price, though for some items, like fuel pumps, even the dealer list price is not a good idea.
"I never try to be higher than the dealer list for any part I sell," he adds. "I would rather mark up my labor, which is such a variable, nobody can put their finger on it."
