The digital age challenge for car dealers

We were recently asked a very interesting question regarding online technologies and retailing for (often seen as very traditional) car dealers. ‘Now that online is inevitable, what can car dealers do to improve their digital offering and stay ahead of the game?’

The traditional aspect of this industry is likely to make any drastic change harder right now, but as we all agree, the digital era is here, and change is pretty much inevitable. The question then becomes where do you start and why.

Technologies are making us more educated as customers

The main challenge car dealers will face is that people will not come knocking on their doors for information as they currently do. Showrooms today have turned into the only way for potential customers can get an actual price, and even then this is not always very straight forward with all the finance considerations and the sales rubbish.

In other words, everybody knows the salesman pitch (or barrier): walk in with a pregnant wife and their safety ratings are the best, let them know you carry a load of stuff around and their booth space is above industry average, obviously if you work on the road their fuel efficiency is just better than anybody else’s.

Clearly every option will always be the best for you and unless you are an accountant, you will probably think (right or wrongly so) that the salesman will push you to the financing option that benefits them most.

That’s until smartphones, search engines and finance calculator apps came in.

Customers now enter dealerships much more informed of their choices and options. They will have seen the specifications and options. They will have compared the prices. They will have read the reviews. They will come in to give it a test drive and get a feel for this relatively significant purchase they are about to make. Perhaps a question or two about the latest gizmo which, somehow, Google didn’t know much about. Right.

Customers are now more informed then ever before and will enter dealerships once they already know what they are looking for.

Reinventing the car dealers, online

In preparing for this, car dealers don’t have to reinvent the wheel. They need to look at offering an experience better tailored for tomorrow’s customers. They must have easy access to the most complete product information for their products as well as their competitors. This includes pricing details, mechanical inspections for used cars, availability at certain dealerships, recalls and historical reliability data. Throughout all brands and all models.

Bundled with the ability for anyone to review or rate cars which is essential today, transparency is the foundation of trust throughout communities online. The known ‘build your own’ tools are doing exactly this, however barely scratching the surface and for some unkown reason, not allowing to save your actual selection criteria’s, your profile! I care about A, D and E, not so much about B, C and G, and to speak candidly I couldn’t give a crap about F!

All we get out of this ‘build your own’ thing are numbers which cannot be compared, a price which the dealer will not stick to and a few photos of the selection made (which, let’s face it, are sometimes plain hopeless!)

Visitors need to be able to search, compare and review on what matters to them. They have to be empowered. They have to trust that the dealer’s online presence is objective, acurate and clearly unbiased. Then to build a trust-based relationship (and hopefully close a sale), add on top of that some instant access to competent staff online, via a chat interface, to ask any outstanding questions or perhaps even a video feed to show visitors the one or few cars they are interested in. So they will really only come in to finalise the sale.

All this with proper visitor behaviour analitics and tracking, obviously.

Surprisingly there’s nothing new here in terms of technology. Video feeds and chat interfaces, rating and reviewing systems, searching through databases, displaying and comparing information, saving behavioural data to be reported on… none of this is in any way ground breaking!

The end result

It will only become harder for the ‘traditional salesman’ to sell anything to anyone. The way forward requires an element of trust because buying the same car, from a different dealer is just as easy as buying the supermarket self-branded products once you know they’re essentially the same as the other commercial brands.

Customers will visit one garage over another because they know they can trust them. Even if this mean paying a little bit more. After all, they have already disclosed every bit of information there was to know about each and every car.

Technology can be used to help funnel the consumer through the information, evaluation, purchase and after sales process. Leveraging existing technologies and implementing web or mobile technologies can assist consumers through that process, as well as the salesman on the floor. For example, for after sales support a web booking system can help manage and alert customers to their upcoming car services. Helping continue their relationship with you.

As a closing note

It appears, Twitter, Facebook, LinkedIn, the more recent Pinterest and others are very well suited for marketing of consumer brands. They can help carry consumers through the information and evaluation stages, and are perfect to maintain the last few emotional strings we have with our cars, until they become more of a commodity than they are now! Businesses and dealers need to utilise the technology and networks consumers are used to in the 21st Century to remain relevant and top of mind when consumers are considering their next purchase.

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Written by

Managing Director of EmpireOne Group in Sydney, Sebastien has made a life of understanding both sides of the fence. Born in Canada and educated as a self-started business software engineer, not a single day passes without finding Seb tweaking a process, system or piece of code.