With Spring already here, the automotive sector continues to undergo profound and fundamental change. Manufacturers, dealers and customers alike are not only welcoming the warm months ahead but also are embracing a transformed – and still transforming – industry landscape.
These are incredible changes, and true innovators in the sector are setting themselves up to succeed.
The Great Thaw
It has been a long winter for many of us, and it arrived on the heels of a challenging year. Yet after so much challenge and loss, humanity has finally gained an edge on COVID-19, and we are carefully starting to emerge from isolation, reconnect with friends and family and get back to our lives.
For the automotive retail space, the past year has accelerated trends that already were well under way. Like many sectors of our economy, a focus on customer experience and convenience, made possible by powerful digital and mobile technologies, already has become an essential value proposition and a key differentiator for auto dealers. The realities of 2020 have only accelerated this trend.
OEMs and dealers that have deployed next-generation technologies to provide an intuitive, customer-centric e-commerce experience have been able to pull ahead of the pack this year. Dealers that adopted these approaches experienced a 400% increase in online transactions year-over-year, coupled with a 25%-30% digital-transaction boost as a share of overall vehicle transactions, according to Modal’s analysis.
And though life now seems to be (slowly) returning to normal, the demand for technology-powered, customer-centric auto e-commerce experiences is here to stay.
Spring Into the Future: Four Essential Capabilities for Dealers
So, what determines success in this new era? How can dealers take full advantage of not only the warming season, but also this new customer-focused digital revolution in our industry? Below are four “mission-critical” capabilities in digital retail and e-commerce solutions adopted by successful dealers.
- Empower the Customer: A successful e-commerce solution gives customers control over where to start their car-buying process, whether that’s reviewing vehicle inventory, getting a trade-in estimation, evaluating financing options or exploring delivery options. Successful dealers understand how stressful a vehicle purchase can be for many and deploy a digital retail approach that minimizes that stress by giving the customer choice.
- Make the Process Frictionless: The dealers achieving the most success in this new era are those who empower their customers to easily perform any step in the car-buying process online, in the showroom or a mix of both.
If they’d like to do some steps online and some in-person, the experience should be seamless, and the customer should never be burdened with having to repeat themselves or do something twice.
And while they’re online, the experience should be fully integrated with the dealer’s website at every step, and never force the customer to leap-frog to a different website or open up a new tab.
- Enable Real Transactions: The dealers that have achieved the most success in this new era are the ones deploying a digital experience that supports all essential aspects of an auto purchase, not merely the ability to review inventory and capture the customer’s email address.
They support “hard” credit pulls, provide financing option packages for review, enable “end-to-end” management of the trade-in process and support digital signatures across the entire process.
These capabilities streamline the buying process for customers and empower sales teams to spend more time engaging each customer, driving greater sales throughput overall.
- Future-Proof Your “Digital Dealership”: If 2020 has proved anything, it’s that we are poor predictors of the future. The dealers that outperformed their counterparts this past year were mainly those who could innovate and adjust to their new realities fast.
We can be confident that technology will continue to advance and customer expectations will continue to evolve: The ideal solution empowers retailers to deploy quickly, integrate with their other operational tools (such as website, finance, CRM and F&I systems) seamlessly and adjust with agility.
Spring is here, summer is around the corner and a new era in automotive retail has arrived. It’s a moment of incredible opportunity for auto dealers, and customers will reward innovators who can deliver.