5 steps to modernizing the buyer's journey

Projections for U.S. light-vehicle sales in the next five years are optimistic. According to research shop Benchmark Co., there will be a record 245 million licensed drivers in the United States by 2025, with current demographics supporting 16.5 to 17 million vehicle sales annually over the next five to 10 years.

But as many dealers learned through COVID-19, rosy forecasts are no reason to get complacent. Expectations of modern car buyers are changing.

And according to Deloitte's Global Automotive Consumer Study, 78% of current car buyers rated the customer experience as a "somewhat important" or "very important" factor in choosing where to buy a vehicle. That means dealerships that don't align their sales processes risk losing car shoppers to competition that have. 

Portrayed early last decade as being uninterested in buying cars, Millennials have evolved as they got married, bought homes, and started families. COVID-19 has accelerated that even more, according to a new study from EY Global. It found that Millennials are expected to lead a car ownership boom in the coming year across the globe. 

According to results of the 2020 EY Mobility Consumer Index — which surveyed more than 3,300 consumers this past November — nearly a third of respondents who do not currently own a car say they plan to buy one in the next six months. One in five respondents who already own a vehicle said they would be open to purchasing an additional vehicle. Both groups cited COVID-19 as one of the top reasons.

Born after 1996, Gen Z also is buying cars in greater numbers. According to Automotive News, this generation is entering the workforce in the tens of millions with $3 trillion in purchasing power.

Although both Gen Z and Millennials have vehicle preferences unique to their demographics, those preferences will change as their lifestyles change. Their shopping behaviors and expectations are also sure to change. Take the following steps to optimize your dealership’s sales process to their preferences:

Before the spread of COVID-19, just 32% of car buyers said they were open to buying online, but now 61% are open to this idea, according to the CarGurus COVID-19 Sentiment Study. 

To meet car buyer expectations, many dealers are investing in digital retailing tools. Whether your dealership has adopted an end-to-end solution that enables the entire purchase online, or is offering a hybrid experience that allows buyers to complete parts of the process online, it's important to offer a seamless online-to-showroom transition. Critical features and capabilities of a digital retail solution include:

•    Provide customers with the ability to save and retrieve deals, whether online or in the showroom

•    Allow consumers to configure their deal online, including payments and finance term

•    Consider a digital retail solution that integrates with your website and CRM to speed up the purchase process and reduce mistakes related to manual entry errors

•    Choose a solution that calculates precise pricing, incorporating the customer's credit score, local taxes, and related fees

•    Allow consumers to learn about available F&I protections

A popular misconception is that digital retailing assists with car sales only. Digital retailing doesn't end with vehicle purchases. A complete digital retail platform possesses connections to the dealership's CRM and equity mining tools to leverage insightful data to engage and re-engage customers via their preferred communication channel. 

Not only does this ensure additional service revenue, equity mining helps identify opportunities to get past customers back in the sales cycle.

A typical car buyer deals with at least three people during the purchase process. In some dealerships, that number can be as high as eight. For example, a car shopper might communicate with a BDC agent, an Internet salesperson, a salesperson, a floor manager, a sales manager, the F&I manager, and a delivery coordinator — all just to complete one transaction.

Your first goal should be to reduce the number of employees involved in a vehicle purchase resulting from a digital retail tool to two or fewer. The sales consultant is the natural point person. Next, aim to reduce the amount of time it takes to buy a car.

According to Autotrader.com, the average CSI score drops after a consumer spends longer than 90 minutes at the dealership. Therefore, aim for a purchase process that’s 90 minutes or less, and use technology to help reduce customer wait times. The benefits of moving parts of the F&I process up stream is an expedited purchase process, increased transparency, and elimination of waste associated with printed paper. 

Here are tools designed to help speed up the transaction process:

•    Mobile CRM to seamlessly transition customers from online to the showroom

•    Mobile vehicle appraisal tools

•    Digital F&I menu offering product video presentations and features, such as a needs-discovery survey, designed to feed information to the F&I producer

•    Electronic signature capture tools and laser forms that can be electronically signed and stored within the deal

The tools listed should also work on a tablet, which represents a great way to introduce new technology into the dealership. These devices are relatively inexpensive, and most employees know how to use them.

Besides digitizing your in-showroom and F&I experience, it’s important to offer remote signing capabilities for customers who prefer not to come into the dealership. Ask your DMS vendor if it offers an electronic document solution with a remote-signing option, along with the following:

•    Signature boxes already set up on the forms to prevent missed signatures

•    The ability to suspend and save a signing session so forms can be added or multiple deals can be prepped in advance

•    A digital deal jacket containing all the signed documents and can be emailed to the customer or provided to them on a thumb drive

•    Digital storage capabilities so documents are easily accessible and can be searched by the customer’s name 

The addition of digital retailing has only increased the number of potential outcomes for dealerships. The key for dealers is to identify the connection point between their proven, in-store process and today's budding online buying channel. Consider the customer who chose a vehicle, acquired outside financing, and expects to close their deal soon after arrival. That means there may be no need to put them through the qualifying process or subject them to a sales pitch.

To create a customer-centric process, start by mapping your customer journey. Make it a group project and ask for input from your sales and F&I teams. Use a whiteboard and erasable marker and be specific about who should handle leads, how they should be handled, and what customer expectations are at every step. 

Once the process is perfected, document it, and create a training booklet for new employees. Be aware that online car buyers might take weeks to go through the purchase process online — a reality for which your plan needs to account.

Modern car buyer expectations are changing the roles and responsibilities associated with dealership salespeople, F&I managers, and BDC agents. Today's informed buyers need nurturing and assistance, not just closing. 

Many dealers are experimenting with different options. Some dealers are creating a concierge-type position, where the person presenting the vehicle is a product specialist and takes on a consultative role. Then a manager handles every aspect of closing the deal, including F&I. BDC agents may need to be trained to facilitate a remote or online car-buying process.

The good news for dealers is that rethinking staff roles can create more hiring opportunities. Many dealers are challenged by high turnover rates in the sales department and have trouble finding experienced salespeople. 

The key to developing a successful customer-focused sales process is training. Modern car buyers do their research, so your sales staff must be knowledgeable about your product line. When your staff members can't answer a customer's question, they risk losing a customer's respect. Ensure your sales staff knows all of the specs and features associated with every make/model.

Today’s car shoppers demand a customer experience that’s fast, transparent, and focused on their needs, rather than what’s convenient for dealership staff. Building loyalty with tech-savvy Millennials and Gen Z buyers requires investing in technology solutions that drive a customer-centric sales process.