• by Karl Greenberg , March 31, 2015

In some ways, the dealership is no different than any other retail experience: where the store is personal, low pressure, and driven by product knowledge, you will spend more and return later. 

Auto shopping and research company Autotrader, with a bevy of new consumer data, pretty much aligns to this common-sense proposition around the power of a  high-value experience. The starting point looks grim, superficially: according to Autotrader data, only 17 of 4,002 consumers remotely enjoy the dealership experience, even after years of automakers trying to change how it's done. As Autotrader CEO Jared Rowe pointed out in his presentation on Monday, with the industry expected to sell 17 million new cars this year, that is a lot of unhappiness. 

Myth number one: the future of automotive sales won't involve human beings. “It's the myth that salespeople won't have a role in the future,” he said. “We found from our research that this isn't true. We think salespeople will have an enhanced role.” Autotrader study data said 84% of all consumers want to buy a car in person. The study said 85% of women want to buy in person. Forty-three percent of consumers want to go to dealerships to learn, not just close the deal. “You build value talking about feature benefits, and the importance of the dealership experience actually skews higher for Millennials,” he said. What they want, notes Rowe, is an Apple Store-type experience, complete with the automotive version of the Genius, along the lines of what BMW is planning for its stores. 

The second myth is that consumers don't want to negotiate. This, perhaps, is the most surprising news. Autotrader finds that 56% of consumers say they do, in fact, don't mind the haggle process, and that flat-rate pricing is not something people really want to accept. Partly, says Rowe, because a flat-rate price is not necessarily one that consumers think will be fair, especially when they can cross- shop online anyway, even while in the store. “You have to believe it's a fair price. As an industry, we haven't learned that just yet.” 

Myth number three: it's all about the transaction price, and consumers will simply go where that number is lowest. “What we have seen is that consumers will actually pay more if the process is to their liking,” said Rowe, adding that 54% of consumers say they are willing to pay for a good experience. “This shows that the process is valuable  And consumers are willing to invest in it. They are willing to drive away with a car more with a great salesperson versus cheapest price.” 

While the test drive is critical, the quality of it is just as important, per the study. And a big part of that is how the salesperson in the right seat treats you. Sixty-eight percent of respondents said they want to the salesperson to talk features and answer questions, not talk about why the car is the car the customer needs to buy. No “what would it take to get you to buy this car?” And car shoppers want to test-drive multiple vehicles in one place. Sixty-seven percent want to have less pressure in the process. 

As for the paperwork, this is one of the major pain points Autotrader found to incite terror in the auto shopper. It isn't just the complexity, it's the time. The firm finds that, on average, buyers are spending over an hour signing “on the line which is dotted” to quote David Mamet. “The deal structure should definitely begin online as over half polled said the fear factor is reduced if there is confidence about how the process will work when they show up, and over half said they want to start the negotiations on their terms,” says Rowe.