It’s no secret that the motor industry is having to adapt to a major sales shift. Customers are flooding to online sellers, leaving the car showrooms barren and empty. In fact, 90% of all car buyers now start their search online. Only 10% walk into the dealership with no prior research or information under their belts. It has also led to the huge rise of the private used car market. Websites like AutoTrader and eBay have changed the way we sell cars. And, changed the way we buy used models. It puts dealers in a tricky position. The best are learning to quickly adapt to the change. But first, we need to understand why customers are flocking to the internet.
Bigger range – Visit your average Ford dealer, and you’ll only find ten models on display. And at least half of them are out of budget or not what you’re looking for. That’s a very limited range considering how many cars are on the market. Online, the customer can immediately compare the Ford Fiesta to the Vauxhall Corsa. They can check out the Volkswagen Polo at the same time. As customers, we can compare and contrast a much bigger range while sat on the sofa!
Better value – Dealerships have always been fiercely competitive. It’s one of the few industries that still haggle and negotiate on prices. They still battle to deliver the lowest rates against their competitors. So the industry has always provided good value, if you could haggle for it! But now, there are a new generation of companies that are driving prices even lower. Private Sellers can set their own prices, and even undercut the dealers. Car buying websites often price out the local showroom when it comes to trade-in figures. Car buyers can simply find better value online if they know where to look. It works in the buyer’s favour. It means traditional dealers have to find a new way to compete.
More information – The internet has opened the gates when it comes to research. Car buyers can now gather all the information and data they could possibly want. In the past, you’d have to visit the dealer, browse through the brochures, and trust what the dealer was telling you. Now, you can find the engine sizes, specifications, and comparisons with a simple Google search. The monopoly on information has shifted out of the hands of the dealers.
Closing times are longer – We’re not talking about opening and closing times here! In fact, we mean the time taken to seal the deal. In the past, a customer would walk into the dealership and test-drive the cars. The dealer would ring them the following day, and the sale would complete fairly soon after. New research shows that closing the deal now takes 45 days! That’s because research starts online, and the market is much wider. With that in mind, dealerships are trying to seal the deal online, from start to finish. It means using sophisticated dealer CRM techniques on their websites. It aims to shift the buying process from the showroom to the internet. So far, it’s working.
Buyers are certainly moving the whole process online. But remember, dealers still have one big advantage. They’re still trusted, and they’re still the experts.