While most consumers want to start their automobile buying process online, they still want to take a test drive and sign the final documents at a dealership.
That’s according to the “Future of Digital Retail Study” from Cox Automotive, which surveyed 2,550 in-market car shoppers.
Dealers gain a competitive edge by offering online steps to the sale — 85% of shoppers are more likely to buy from a dealership that offers at least one component of digital retailing.
Eighty-three percent of consumers want to do one or more steps of the purchase process online but 89% of consumers also say they want to sign final documents at the dealership. Dealership staff are valuable consultants — 62% of consumers still want help from dealership staff even if online purchase options are available.
The most interesting finding from the survey actually turned out to be the most important for the future of the automotive retail landscape, says Autotrader Senior Analyst Michelle Krebs.
“Dealerships, despite disruptive technological changes, remains central to car buying,” Krebs tells Marketing Daily. “However, the dealership model needs to evolve with consumers’s ever-evolving preferences. It’s understandable that most consumers want to complete one step of the one process online, but to uncover that a clear majority of car buyers want to complete the purchase at a dealership fortifies our thesis: the dealership is not dead, just the way we buy vehicles is.”
Overall, consumers want a transparent, self-directed, personalized, no-pressure shopping experience measured in minutes, not hours — a process they can start online and finish at the dealership.
“Dealers need to have a better understanding that today’s consumer preferences dictate the trajectory of where we as an industry need to head,” Krebs says. “The results of our study show that the most successful dealers are the ones that offer a connected in-store and online experience, where consumers start car-buying activities online and finish them at the dealership.”
A more efficient process is not only better for consumers, it’s better for dealers as well, she adds. One manufacturer example is with Hyundai and its innovative Shopper Assurance program, which is powered by Dealer.com’s Digital Retailing solution. Shopper Assurance allows dealers to set prices through VIN-specific vehicle pricing and pertinent consumer discounts. The specific Hyundai dealer is then able to set its own amount of discount off that vehicle's sticker price. The final price is then published on the dealer’s website, with the goal of reducing time spent in-store haggling over price, an activity we know most consumers are not interest in.
“We believe a lot of that upfront price negotiation can happen online, and when it does, everyone is more satisfied,” Krebs says.
Millennials are helping set the bar, or expectation, of the future of car buying experiences. Earlier in 2017, Cox released a specific cut of its annual “Car Buyer’s Journey” study, specifically geared toward the Millennial buying segment.
“The study identified a couple of key trends with the generational segment when it comes to buying a car, such as a frustration with the current customer experience and taking more time when it comes to purchasing a vehicle due to the digital/online options available,” Krebs says. “Those consumer preferences rang true in the ‘Future of Digital Retail Study,’ particularly in the desire to complete the majority of the purchase process online given the accessibility and availability of options, as well as the want for a more streamlined, seamless in-store experience.”
Ultimately, 2018 is the year we are going to see more dealership change the way then sell cars, she says.
“The technology and tools are here to make car buying more efficient for both consumers and dealers,” Krebs says. “With new solutions streamlining the experience, we firmly believe the dealership is not dead—but the old way of buying a car certainly is."