The amount of time it takes to transact a vehicle sale at a car dealership has been an issue over the years.
And it’s not just customers who have said it has taken too long for their tastes. Dealers say the same thing, says Isabelle Helms, Cox Automotive’s vice president-research and market intelligence.
But things are getting better. And shorter. Helms (pictured below, left) credits that to the surge in digital auto retailing that picked up steam last year when the COVID pandemic hit hard, making customers leery about visiting dealerships in person – if the stores were open at all. (For a time in 2020, many weren’t by state government mandate.)
“Saving time is the universal draw” of digital retailing, she says at an online Auto Intel Summit.
Citing her team’s research and surveys, she adds: “The No.1 expectation of shoppers that engage in digital auto retailing is that it saves time at the dealership.
“The same expectation holds for dealers. Sixty-one percent say the No.1 benefit of digital is to save time on the sale.”
A vehicle purchase is inherently a complicated process. There’s no express lane for it, nor should there be. A typical deal involves time spent on a variety of matters.
- Arranging financing, which can get tricky if a customer has less-than-sterling credit.
- Evaluating a potential trade-in vehicle, which can become a protracted process if there’s a customer-dealer disagreement over the trade-in’s value.
- Negotiating a vehicle price, a back-and-forth activity that can go on and on.
- Filling out and signing the paperwork. Car buying and selling is highly regulated, resulting in a pile of documents to handle.
If all that is done at the dealership, it can take three hours or more. That’s when customers get impatient. But as more of the car-buying process is done online, less time is required at the dealership. That makes everyone happy, from time-conscious customers to dealers who don’t want salespeople bogged down on a seemingly endless deal.
“Digital has sped up the process,” Helms says, reporting that some buyers are at the dealership for only about 40 minutes to finalize the transaction and take delivery of the vehicle.
A long-standing pain point for many customers is how long it takes in the finance and insurance office where, among other things, aftermarket protection products are presented and sold, she says, referring to a Cox customer survey. “Four out of five now say they want to do F&I online and finalize the deal.”
Yet many dealers say selling F&I online is tough. And in many states which require “wet” signatures, a car deal by law cannot be remotely consummated.
Still, “70% of shoppers say they are open to the idea of buying a car completely online,” Helms says.
Other survey results include 78% of dealers saying they are willing to change their dealership process to meet customer expectations. Of polled dealers, “eight in 10 believe in digital as a long-term strategy,” Helms says, adding there’s no going back.
“Consumers are making it clear they have no interest in reverting to the old ways. Two-thirds of them said that the next time they buy a car, they want to do more online. And three out of four dealers agree they won’t be able to survive without embracing digital.”
Steve Finlay is a retired WardsAuto senior editor. He can be reached at [email protected].