From the outset, the automobile called for its own approach to marketing. In particular, the early motorcars required induction training for customers to operate them, and particular care had to be taken in servicing and repairing them. Benz and Daimler recognised this at an early stage and structured their sales organisations accordingly. From these early beginnings, the company-owned sales and service outlets developed – a principle that has been maintained to this day.

In the beginning, cars were manufactured individually and sold to customers straight from the factory. Advertising for the modern motorcar took the form of public demonstrations and subsequent newspaper articles. Later, for a relatively brief period both Carl Benz and Gottlieb Daimler made use of independent agents who sold the automobiles on own account. But this sales channel was unable to speed the progress of model policy: the initially individual orders now merely were handled by the agents instead of coming straight from the customer. This continued to impede series production, even if Carl Benz did manufacture a comparatively large number of units of his “Velociped” model in this early period – 1200 between 1894 and 1902. Model variety would dominate until the turn of the century.

With the spread of the automobile, which began towards the end of the nineteenth century and quickly gained steam, the companies sought to offer few models but pre-produce them in larger numbers. The independent agents were more a hindrance than a help in this endeavour – the automobile manufacturers did not want to be too dependent on them. To better cater to public taste, but most of all in order to have a say in the pricing, in the first decade of the twentieth century they supplanted the external agencies by the system of manufacturer-owned sales and service outlets: a distribution system which then became the norm in the automobile industry and, at an early stage, stood out in contrast against the sales systems customarily used for other products.

At the start of the twentieth century, first Benz & Cie. and shortly thereafter Daimler-Motoren-Gesellschaft (DMG) sought to ensure their direct influence on sales through this distributive channel, unique in the commercial landscape. The agents no longer would have the freedom to fix prices; the factory wanted to control how and at what prices selling would function. It was also a way to secure the after-sales service business for themselves and save the money for intermediate trade levels. For in the meantime, the political sphere also had discovered the automobile as a source of income. In Germany, car buyers had to pay a luxury tax starting in 1906, and take out liability insurance from 1909 on.

So the automobile manufacturers gradually became dealers as well. Considering the disputes today between the producers of proprietary goods in other industries and the retail trade concerning mainly the pricing of products, Benz and Daimler exercised good foresight in reorganising their sales channels.