Without a doubt, the online car-buying process journey is changing. We have more information and tools available to consumers than ever before, but in the last year alone, we’ve added many essential tools for the benefit of the dealership. These tools have helped dealerships stay open and still transact, but maybe weren’t always helpful to the consumer.
So, even with the increased access to information, the car search is still over 900 touchpoints. And with vehicle inventories at record lows, it’s harder for consumers to find the vehicle they want.
Electric vehicles have added another twist to the equation. Washington state plans to ban the sale of gasoline cars after 2030. So now drivers in states like Washington may have already purchased their final gas-powered vehicle. Every consumer now needs to determine when it’s the optimal time for them to switch to electric before state or federal regulation forces them to.
The challenge for dealerships now is to make tools that empower the car buyer first and foremost. Hopefully at some point we can achieve a car search in less than 900 touchpoints per buyer. But due to the current supply shortage, consumers are probably going to have to shop more dealerships than they have been in the last couple of years to find their optimal vehicle.
As consumers are monitoring the new experimental EVs that are coming to market, they’ll want research, will want to know if that’s relevant to them or not.
And as the availability of pricing and payment options become more the norm than the exception and customers go through the affordability discovery process online instead of in the store, dealerships can help locate the right vehicle online by being transparent.
This is a big trend. Many years ago, there wasn’t as much price transparency on dealership websites. Then we started showing as MSRP or an asking price and required a form fill for customers to get a price. And now we’re finally sharing monthly payment options on the actual website. So we’re no longer hiding the price of the vehicle online. Some consumers are now aware of the upsale of financing insurance warranty products after completing their initial vehicle purchase. They might start shopping for some of these services prior to selecting a car dealership to see if they really are necessary. But I think overall, focusing on optimal vehicle instead of lowest prices is very important, especially for this year with the inventory shortage.
While F&I upsells can be an uncomfortable part of the shopping process, dealers can keep shoppers engaged online by assisting with the comparison process.
Previously, consumers would have extra staff helping them at the dealership, trying to get them into the car that they want. Now consumers are on a dealer’s website and F&I is built into the pricing and payment options that there’s a retail has provided great for consumers, but they may have tried shopping a few different dealerships and comparing prices from dealer websites that use different digital retailing providers. Consumers are basically are filling out several long multi-step forms and their progress may or may not be saved. And this is all for getting pricing and payments on a single vehicle. So I think the opportunity to dealerships maybe can help consumers compare all inventory at the store or between multiple dealerships, if you’re a group and focus on the best vehicles for the customer instead of whether or not they qualify to buy a certain vehicle.
As of the future of online car shopping, it looks like Google, Facebook and others are starting to offering inventory listings directly. I would expect the Amazon, Google and Facebook marketplaces to become much more significant, especially for electric vehicles and used inventory. However, I think as electric vehicles continue to be developed, our cars are now our most expensive technology device. And more and more, consumers are going to need the service technicians at a dealership to take care of the technology support for that’s specialized for each manufacturer. So, in 10 years, even with more car sales going through Amazon, Google, Facebook, etc., I still think the local dealership, as the model lines change more to electric, are going to keep playing a pivotal role because they can fix your vehicle when it breaks down.
Overall, finding the optimal vehicle for the consumer, rather than the lowest price, is our focus this year. And so, we’re working with dealerships, trying to help everyone adjust their messaging, starting with their advertising campaigns, but also the dealer website. A dealer’s site is actually more valuable if it’s helping a customer find their optimal vehicle. Car prices right now are at a record, and they’re increasing. Many models are appreciating even if it’s not a rare vehicle. And so, this summer’s sales won’t be about the lowest price. It’s a much better opportunity to focus on personalization and how your dealership helps customers find the best available vehicle.
For more information, visit driverbase.com.
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