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The ‘Amazon Argument’ Doesn’t Work Anymore

The pandemic hyper-accelerated the convenience economy and it’s here to stay.

April Palmer is obsessed with helping companies in the automotive industry to create raving fans. She is VP of Growth and Strategic Partnerships for HopDrive, Professor of Entrepreneurship at VCU, mentor and consultant to startup founders around the world, enthusiastic (if not that talented) public speaker, and she runs a weekly live podcast on LinkedIn to celebrate professional failure. Visit www.hopdrive.com for more information.

“Buying a car is a whole lot different than buying something on Amazon.” 

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I’ve heard this argument many times. It’s the pushback our industry has used over and over again to excuse itself from giving car buyers the experience they really want. 

This argument doesn’t work anymore. In fact, it never really did.

Case in point? The dealers who not only survived but thrived through COVID offered services like video conferencing, at-home test drives, in-driveway deliveries, online appraisals, electronic paperwork processing and concierge vehicle pickup and delivery. 

Unfortunately, many of the dealers who stayed the course with a “business as usual” approach during the pandemic took a major hit to their profits, laid off staff or shut their doors altogether.

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The truth is, car buyers have always wanted a more convenient experience than our industry was willing to provide. The success that digital retail companies like Carvana have achieved is proof of this (and a whole lot more than coincidental). Similar business models have carved out staggering market share by engaging consumers with ease and convenience and believe it or not, customers are actually willing to pay more for their cars as a result.

It’s time to stop lying to ourselves. The pandemic hyper-accelerated the convenience economy and it’s here to stay. Pandora’s Box is open and it can’t be shut. 

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Today, we have every tool in the shed to make car buying and ownership as easy and convenient as Amazon. Brilliant minds in our business have created digital products and services to deliver the experience car buyers demand right now. Sure, there are a sea of solutions and the automotive technology waters are muddy, but we must determine the products that work best for our dealerships, commit to a better way of doing business and, most importantly, provide our customers with a better experience.

Specifically, the importance of a dealership’s service customers, and their satisfaction, cannot be overstated. Here’s why.

Service is your dealership’s best line of defense. 

With dwindling margins, new car inventory constraints, skyrocketing used car prices, chip shortages and the proliferation of digital retailers who gouge market share each and every day, your dealership’s service department is your saving grace. For example, Carvana’s customers will eventually need their cars serviced, but Carvana doesn’t service the cars it sells. Who better to offer that service than the expert technicians at your dealership? (The technicians who, by the way, will provide such an amazing experience that your customers will buy from your dealership when they are ready to trade in and up — because we all know that sales sells the first car, but service sells the next three!)

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70% of consumers would switch to a concierge dealership.

That’s right. Seven out of 10 consumers say they would switch to a dealership that offers concierge pickup and delivery for service appointments, at-home vehicle purchase deliveries and other miscellaneous in-driveway conveniences versus one that doesn’t. NADA says that your dealership pays over $600 in marketing expenses to acquire a single customer. Why not reach service customers you’ve never met before — wherever they are — to drive more business at a fraction of the cost, while improving CSI along the way? 

Concierge dealerships see increased ROs, trade-ins and new car sales.

Based on our experience and the results of our dealer client base:
Dealers who use concierge services state that at-home service customers are more likely to agree to additional repairs versus customers who are waiting at the dealership, resulting in increased ROs.
Dealers who have implemented service lane appraisals have been able to acquire in-demand inventory they want and need without escalated auction fees. 
Dealers have cut marketing costs by upselling live concierge customers into replacement vehicles and have delivered these same vehicles to customer driveways within hours.

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Let’s face it. 

Being a car dealer today has never been more challenging and you need every advantage you can get. Your biggest advantage begins by creating raving fans for your dealership, which starts with offering a convenient and easy car-buying and ownership experience for your customers. 

When you make it easy and convenient to do business with you, your raving fans will be happy to tell their friends, who will tell their friends, who will become raving fans of yours, too — just like the millions upon millions upon millions of people who are raving Amazon fans.

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It’s easier than you think and worth every penny.

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