The COVID 19 pandemic has accelerated digital retail as retailers struggle to rethink their sales process. The automotive consumer experience has been reinvented, and car buyers are visiting fewer dealerships during car purchases, according to a new report from the National Automobile Dealers Association (NADA).
But the digital transformation also offers significant benefits for retailers, and they now have more insight than ever into what customers want. Indeed, the use of technology has been so successful that managers like Tillman can keep their dealers in the game, even if today’s car buyers are shopping differently than car-buyer studies predicted four or five years ago. Nowadays, Automotive Digital Retailing is more critical than ever.
According to most retailers’ survey, digital retailing’s potential is compelling, but many retailers still believe that transparency and profitability are at odds. For example, only 66% of traders surveyed agreed that it is easier to simplify processes to generate more volume and higher profits, which benefits managers. In some ways, it seems clear that digital retailers’ trend means that car buyers have more control over their purchases than ever before. According to Tillman, traders may still be reluctant to introduce digital trading tools because they fear a lack of control over transactions.
According to a recent survey by the National Automobile Dealers Association (NADA), 70% of car buyers say that online dealers are reviewing their influence on where they want to go. Although some dealers have digital retail tools, 73% of customers who buy a vehicle have to go through a multi-step process.
In April 2020, dealers identified as dealers with or without digital trading opportunities reported that their gross profit per vehicle sold (GPRS) increased by 3.5% compared to the same period last year and by 4.7% in the first quarter of this year. According to the NADA survey, the number of retailers identifying as digital retailers is growing at an annual rate of 1.3 percent.
More Flexible than Traditional Approach
Harrell argues that today’s digital retail tools allow customers to work backward in stores, but merchants need a CRM to do the same. The problem is that retailers don’t treat digital retail as a tool to reward customers for making a purchase, he says.
Since merchants’ transactions vary, your digital sales plan must be flexible enough to meet best the customer’s needs, not just the merchant. Ensure your sales team understands the benefits of using digital retail tools and how and why you should treat digital retail customers differently from walking in. Also, make sure your customers understand how to use features that digital retail cannot support.
It brings us to the next point, which is why retailers should integrate digital retailing into their current business models. Some retailers may think that digital retailing is too expensive for their merchants, but at this point, many would agree that not all of us can afford it. It includes employees who work from home, so it is more important than ever to ensure everyone understands their marching orders. Invest in your future and invest in the future, not just for your car dealership, but for the entire automotive industry.
As mentioned earlier, offering the best digital retail experience means providing great tools on your website and your retailer. It is essential that everyone is on board with digital retail to put your dealership on the road to online retail success.
By offering a low-stress digital retail environment, used car dealers can attract new customers who want to do their research and determine their approximate monthly payment before they are ready to test a vehicle.
A seamless digital retail experience is essential to give consumers the ability to purchase will, whether they want to browse the car, complete a deal or complete multiple steps. When it comes to making a final decision, nothing replaces personal interaction, and this is where digital retail strategies become visible. Getting the car buyer’s attention is very important, but it’s not just getting their attention through advertising; it’s getting it through effective marketing in the dealership. Forget it, when a customer walks in the car dealership door, they know what they want, so automotive digital retail is necessary to get new customers in that door.
As more people buy cars online, it is essential to maintain your digital presence by investing in digital marketing in the coming weeks and months to fill your dealer’s sales pipeline and showroom. The more transactions in your car purchase go online, the more you can focus on your galleries and positive experiences.
We hope that the above research and advice will have given you a better understanding of the ever-changing digital retail landscape, and we would be pleased to hear your thoughts on where you are taking the next phase of digital retail. The next big question is what automotive digital retailing strategies do you use to buy more of your transactions and cars online?