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Role of Auto Dealer in Age of Mobility

The dealership of the future will be integral to satisfying customer demand for unique and personalized experiences, driven by advanced digital technologies.

The prospect of traditional auto retailing shifting to a mobility-as-a-service industry is moving ever-closer to reality, as evidenced by more automakers forming partnerships with car-sharing, ride-hailing services and tech companies.  But as the mobility market takes shape, what role will auto dealers play?

The answer is a critical one. Auto dealerships will remain the lynchpin of automotive distribution at a time when such support could never be needed more. The stakes for both automaker and dealer to succeed could never be higher. Constant improvements in autonomous vehicle technologies are helping to create a mobility services sector that could re-define how auto industry profitability is generated, as car companies, auto dealers and new-market entrants shift to mobility service providers.

While automaker profits and the overall industry will continue to grow, this shift will not be without challenges. While dealers have developed strong marketing know-how over the years, the onset of a digitized world is creating new challenges relative to satisfying the changing needs of digitally engaged car buyers.

They want a seamless online-offline experience that includes useful Web research and in-showroom expert advice about the vehicle they covet (including what it can do) before they buy, hire or share it. 

Providing such experiences is essential to satisfying customers today, and the same creativity and rigor will be required to satisfy changing customer preferences in the highly competitive mobility market.

Auto dealers should consider creating a blueprint to shape the dealership of the future that will be integral to satisfying customer demand for ever-more unique, personalized experiences, driven by advanced digital technologies.

The framework for this blueprint should center on four key actions:

Diversify Formats: Different customers have different ways of seeking a car to purchase. Today, there are variety of formats to chose from, including traditional dealerships, pop-up stores, service outlets, experience centers, mega-stores and flagship retail showrooms.

After-sales customers also want more options. Nearly half (45%) of surveyed drivers want service to be seamlessly integrated into their daily life. By establishing new formats, dealers can attract more customers.

Abandon Old Attitudes: Several established beliefs and preconceptions prevent automakers and dealers from working together more effectively, such as “only the dealer knows customers’ needs,” and “customers focus only on prices.” Understanding customer needs and adjusting accordingly offers a better opportunity for sustained success.

Leverage New Technologies: Apply big data and analytics to better understand what individual customers want, and voice control to allow customers to engage seamlessly with providers. 

Enhance operations by employing artificial intelligence to make it possible for machines to sense, comprehend, act and learn, and Blockchain technology to provide controlled data access to all relevant parties.

Embrace Expanded Ecosystem: New-market entrants – from digital dealers to online financing and vehicle rental services – are disrupting the automotive retail space.

By embracing these newcomers as ecosystem partners, automakers and dealers can not only mitigate the threat they pose but complement their own capabilities and drive more business.

Acquiring the latest digital technology allows dealers to increase their market share by improving the customer experience.

To the credit of traditional dealers and automakers, they have progressed in this area, boosting their online presence and digitizing their showrooms with sales tools, such as virtual and augmented reality, smart Googles and interactive screens.  But more is needed.

Keeping pace with the rapid pace of digital advances will remain daunting. As architects of the dealership of the future, today’s auto retailers should continue to leverage the latest technologies as a valuable addition to their sales arsenal. But they also should augment them using digital as a behind-the-scenes tool to facilitate the optimal customer experiences sought, without defining them. 

As interactions with customers evolve from periodic on-screen engagements to connected customer experiences, dealers will need to create new services that are deeply integrated into the physical world. 

Companies across multiple industries are re-imaging their products and services to meet surging demand for customized experiences and to satisfy future expectations

The most important role auto dealers can play during this transitional period is to continue creating the dealership of the future, working closely with automakers embracing autonomous and electric-vehicle technologies. That will prepare dealers for the new age of mobility.

Brian Irwin (pictured, left) is Accenture’s managing director-industrial North America. He can be reached at [email protected]

TAGS: Dealers
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