The changing landscape of automotive retail

Customer experience still matters in a changing automotive retail world.

With Chinese vehicle showrooms opening without landlines, customer communication using digital and mobile technologies is another example of the automotive market taking a leaf out of other industries' books.

But Mike Jones, chairman of dealer profitability specialist ASE, claims that despite dealerships becoming more sophisticated, some of their sales processes still come from the 1980s. According to Jones, today's dealerships need a product genius, business manager, sales person, business development centre, internet, TV advertising, radio and social media promotion.

Completing a vehicle transaction exclusively online may be happening now but ..."a positive customer experience" alongside better technology is "the sweet spot", according to Dean Evans, Chief Marketing Officer for Hyundai Motor America.

Giant car dealership

Used car superstore Image: TradeCentre UK

The company's customers still see a dealership salesperson at the end of its Shopper Assurance system which allows online consumers to review inventory, structure payments, begin the trade-in process, apply for credit and schedule a test drive.

Evans says. “It’s about a better customer-experience play.  It’s also about trying to bring a better salesperson to the mix.” That means eliminating the numerous back-and-forth trips made by the sales consultant between the customer and sales manager during price discussions.

And price remain a signficant deciding factor, according to a recent study by Ipsos. “The lowest price and inventory are still key for consumers. There is a big disconnect,” says Colin Thomas, a senior analyst with Jumpstart Media who commissioned the research.

Top of the charts for selecting a dealership was lowest overall price, chosen by 49% of those surveyed. Then came vehicle inventory at 41%, customer service at 36%, dealership reputation at 32% and less "pushy" sales environments at 30%.

Dealership websites may also have greater impact than their social media presence. The survey revealed that, although 91% of dealers who engaged in social media thought it was leading to consumers taking shopping actions, only 8% of consumers surveyed said they saw social media activity related to a dealership and acted as a result.

Meanwhile, EVs and hybrids remain the fourth-ranked vehicle search criteria among potential car buyers researching their next purchase online, according to cross-platform measurement company Sophus3.

Sophus3's managing director, Scott Gairns said: “We all know that electric car interest is growing, and it’s clear from our analysis that as a segment it is now more popular for online research and interest than sports cars, city cars and even midsize executive cars. But for car brands to exploit this growing interest, it is vital to understand how potential car buyers behave when on electric car sites, what they are looking for and where they have come from."