Erik Nachbahr says the conversation around dealership data has evolved since retailers started using customer relationship management systems about 15 years ago.
At the time, dealers “kind of were in a bubble,” said Nachbahr, president of Helion Technologies, a dealership information technology consultant. “They just weren’t used to data and how valuable it is.”
Today, Nachbahr told me, dealers are more aware of the power of software to help their businesses run more efficiently. One way that happens, he said, is by synchronizing data collected from customers across the multiple technology tools that dealerships use so employees don’t have to enter information in more than one place.
Technology vendors are working to improve the interactions between products, often from different companies, to offer dealerships a simple and seamless process that, in turn, is simple and seamless for the consumer.
Integrating a third-party vendor’s products requires access to data inside the dealership management system. It’s a primary issue in a federal lawsuit in Arizona over who controls data inside the DMS.
On one side: DMS giants CDK Global Inc. and Reynolds and Reynolds, which sued to block enforcement of an Arizona law that allows dealerships to share data within the DMS with third-party vendors deemed to be authorized integrators. The law also prevents DMS companies from charging fees or otherwise restricting that access.
CDK and Reynolds contend the law is unconstitutional and that it would grant “free and unfettered access” that would put customers’ information at risk of exposure to cyber threats and improper use.
On the other side: Arizona’s franchised dealership association, which argued that the law puts decisions over how much and with whom to share customers’ data back in dealers’ hands.
Nachbahr says a way to provide access is through an application programming interface — a secure, back-end connection that doesn’t require tapping directly into the DMS itself and that can be set up to limit the amount of data shared between the dealer and the vendor.
“It just brings them in line with what every other software provider does,” he said.