Internet car-shopping sites say they're not worried about competition from Amazon's new automotive venture. After all, you still can't buy a car on Amazon, and it doesn't link to dealerships and their inventories. Without that, it's no competitor, they say.
True. As long as everything stays the same, nothing will change.
Except nothing ever stays the same. Consumers always seek easier ways to buy cars. That's why Internet shopping sites could insert themselves between customers and dealers at the dawn of dot-coms. And it's why those sites could lose their grip to the Costcos, Wal-Marts and Amazons that command the loyalty of tens of millions of shoppers -- and not just car shoppers.
The car sites play a key role as facilitators, but they are fragmented, forcing dealers to spread marketing cash across multiple platforms. Meanwhile, consumers must volunteer personal information and await an email from dealership staff just to start talking about an appointment with a salesperson. Such intermediation has no place online.
Consumers choose Amazon for its broad selection, frictionless shopping experience and reliable fulfillment, the same things car buyers want. A dealer could gain by letting them shop that way, serving as efficient fulfillment partner who whisks a vehicle to your driveway and serves your every need afterward. Hyundai just started letting customers order test drives on Amazon. Why stop there?
What makes Amazon especially potent is its ability to think on behalf of its shoppers. If you liked that dirt-bike accessory, you may also be interested in this Toyota Tacoma TRD. In that sense, it doesn't just move shoppers down the funnel, it puts shoppers in the funnel. Consumers and dealers could benefit from letting Amazon's algorithms do more of the heavy lifting.
Amazon isn't there yet. But it's unwise for any player in any industry to underestimate Amazon's power to reshape how goods are sold.
Just ask your local bookseller.