5 Ways Digital Transformation Impacts Car Dealerships

The process of digital transformation has impacted most industries. Automotive is definitely not an exception. The cars we drive today are also driven by technological advancements. But does this mean we’re able to get them as easily as we buy our smartphones?

However, this rapidly evolving technological era could be quite challenging for car dealerships, but very beneficial as well. Modern customers are fully informed about the cars they’re like and once they get to the point when it’s time to visit a dealership, they know exactly what they want. This leads to dealers and manufacturers thinking of the proper investments, which have to be made if they want to improve customer experience.

Buying a car is among the most intuitive purchases you could make. Usually, you just have to feel that it’s right for you and then nothing could change your mind. Actually, a short ride is often the decisive factor. You might get all the information needed from digital channels, but the act of physically driving a car can’t be replaced.

But how to choose which one to try when there are so many options? Speaking of information 59% of buyers do online research to help them decide. The best way for the automotive industry to meet the growing expectations, which come with that is by integrating advanced digital technologies into the buying process.

Car dealerships focus mostly on the immediate digital solutions to reduce overhead and drive operational efficiency, as well as increase transparency while reducing friction in the salesperson. They need tactical adjustments to ease information flow.

Now you now that customers decision journey is highly impacted by the web. Let’s have a deeper look at some of the ways digital transformation impacts car dealerships:

Product Research

Modern buyers have access to huge amounts of data on the Internet and as we mention that impacts on their decision a lot. 95% of them use digital as a source of information. In fact, twice as many start their research online versus at a dealer.

The drop of visits and even test drives is explained by the fact that  after a potential buyer has created a selection of interesting car models, they watch videos no narrow down their choices as much as possible, usually to about 2 brands.

With that said today’s customers don’t go straight to the dealerships when they want to choose and buy a car. In fact, they’ve previously made their choice and the visit comes last, just for finalizing the purchase. This makes online presence crucial for car dealerships, which leads to our next point:

Omni-Channel Approach

Buying a car used to be quite stereotypical. Customers would enter a dealership, seek guidance from a salesperson, take a test drive, negotiate the price, agree on a finance deal and place an order. However, digital transformation has fundamentally changed that.

Furthermore, it has brought to us virtual showrooms and consumer-driven research, noted above. This means dealerships need a solid online presence to capture potential customers via digital sales channels. A consistent brand experience should be provided by enabling consumers to switch between information sources.

An omnichannel strategy is crucial for delivering a seamless digital experience at all levels of the car buyer life cycle. Consumers constantly switch between online and offline channels and want this to happen easily. They expect their preferences to carry across channel boundaries so they don’t have to repeat them over and over.

Embracing Automation

Automation is a trending topic in the automotive industry for quite some time now. However, we won’t talk about autonomous vehicles, but automation in retail. Included functionality like chatbots to a dealership’s website is important for answering any additional questions consumers might have while going through the information you provide.

Consumers tend to prefer this automated approach because it’s way faster and saves their precious time. Car dealerships should also use automation as part of their customer service strategy, as they know many of their physical buyers are still online.

Furthermore, automating simple tasks like follow-up emails and offers can reduce the amount of time your team spends on basic processes, and help them serve your customers more efficiently. It provides seamless, improved and more personalized user experience so that buyers could get the most of dealerships’ website or mobile application.

Interactive Showrooms

Digital transformation presents totally new ways of purchasing cars. It combines the best from both online and offline customer experiences, which is needed to meet the growing expectations.

Digital showrooms are now created and the purchasing process is becoming completely digital. In these new showrooms, consumers are free to use the touch-screen tablets, their own smartphones or even leave their personal details and continue the process later online. Together with an omnichannel approach, this seems to be a preferred and easy to use the method.

A great example of digital transformation in car dealerships is Audi City. It lets visitors find out more about the latest technologies and services and also digitally presents the entire Audi model line-up. Consumers can customize their individual model, view it on a 1:1 scale on ceiling-high displays, and then make an order.

This new concept seems to be working pretty well, which makes more and more brands transform their showrooms into an all-digital space, using virtual technologies.

Advanced Car Maintenance

Predictive maintenance is a feature implemented in modern vehicles. It alerts owners and dealerships when they need a service. However, that’s just the beginning of safer and more satisfying driving experience.

As we mentioned increasing customer expectations are driving the digital transformation of car dealerships. For those who fail to embrace technological improvements, it would be almost impossible to compete.

The predictive maintenance we noted, allows dealerships to lean on this advanced car maintenance technology and dealership management systems which connect the service and sales teams. This way they can provide an aftercare package, which drives customer loyalty.

In a Nutshell

Digital transformation has changed the cars we drive for good. It’s turned them into personalized digital devices, that assist us while we’re on the go. This means that the car buying experience can’t stay untouched.

From the whole new digital showrooms to predictive vehicle maintenance, the increasing consumer demands make manufacturers and dealers embrace the transformation. Our list of ways digital transformation impacts car dealerships only gives a few examples of the changes that are happening in automotive retail.  And that’s all only to ensure the buyer journey is enjoyable, more engaging and interactive.