Car buying is about to get better. Consumers are demanding change, and dealers should be as well.
The separation between our digital and physical lives has become razor thin, even nonexistent in many cases. What we do and how we interact digitally plays directly into our real-world lives, and vice versa. We've seen many industries flourish by embracing interconnectivity with open arms, meeting customers where they are, on their own terms. Yet the automotive industry is straggling behind. Car buying continues to be a roller coaster of ups and downs, and not in a fun way. Instead, consumers experience a disconnected buying process, oftentimes inconsistent and nearly always time consuming.
From the beginning, dealers have been in the driver's seat, directing the car-buying process. However, today's connected, engaged car buyers are looking for a better experience, one they can drive from the comfort of their couch or wherever they are connected.
2018 will be the year the auto industry embarks on the next phase of the Internet — a fully connected retail experience that makes car buying better for consumers AND dealers. For years now, auto buyers have been shopping online, collecting information and searching for options. In recent years, consumers have been able to apply for credit, estimate a trade-in value and find a fair-market value of a new or used vehicle.
Now, as new tools become available, shoppers will be able to structure their deal with a real monthly payment (including price, taxes, fees, incentives and trade-in value), understand and buy finance and insurance products, place a down payment online to reserve the vehicle, schedule a test drive and take delivery.
In 2018, the industry will move in earnest from shopping online to buying online.
But rest assured, the future is NOT "click-to-buy" websites that drop the dealer from the process. Far from it. The future will be built on smart online tools that help connect dealers and buyers in a meaningful way. The future is a completely digital experience that merges the online and in-store experiences. The future is more efficient for both consumers and dealers, where customer satisfaction with the car-buying process improves.
A recent Cox Automotive study found that 87 percent of consumers want to take steps online toward buying a car and 73 percent of consumers are more likely to buy from a dealership if they can start the buying process online. At the same time, 62 percent want help from the dealership staff, even if online buying is available. The study also found that dealers, too, are looking for better ways to reach today's tech-savvy consumer. In fact, 55 percent of dealers are looking for better ways to connect with customers, and 73 percent are willing to invest in new technology to help make the in-store experience better for their customers.
We believe the way to improve the in-store experience is to improve the online experience. As an industry, we need to blur the lines between the digital and physical worlds. We need to build bridges that connect the online and in-store experience.
Companies like Walmart and Home Depot have worked hard to rethink their traditional brick-and-motor roots, creating online experiences for consumers to help better connect with their physical stores. Walmart has embraced online voice-shopping via Google Home and fresh ways to streamline the checkout process and ease product pickup at the store. As Walmart stores are perfectly located within the nation's population centers, the company is embracing technology to drive traffic, customer satisfaction and profitability. Home Depot is taking a similar approach, making products for each storefront easily searchable, with exact aisle and shelf locations included for easy pickup when the customer arrives in the store.
In both cases, technology has improved the business model, not blown it up.
Walmart and Home Depot in particular provide a useful blueprint for the auto industry to provide an experience where customers can shop and buy online but still connect with the dealership in a meaningful way to learn about the product, test drive a vehicle, take delivery and eventually have it serviced. These systems help blur the online and in-store experience.
To survive and remain relevant, dealers must take steps to improve the car-buying experience and meet the needs and expectations of consumers in market right now.
Many dealerships have acknowledged the need to more effectively move the purchase process online. For those dealers, adopting consumer-friendly deal-structuring and buying tools will be the logical next step in the process. For those who continue clinging to their old car-selling ways — controlling the process and not connecting in-store and online experiences — the time is now to embrace the new reality.