The Evolution Of The Car Dealership
If you have been in the market for a new car over the last few years you have definitely noticed some major changes in the process of research, price comparison, test driving, sourcing and taking delivery of your vehicle. Between the effects of Covid-19 and the disruption of the marketplace by of a number of brand new EV car companies, the way in which cars are marketed and sold to consumers is changing drastically. To win over the hearts and minds of today’s consumer is going to require a whole new way of looking at how we market, design, build and roll-out the dealership of the future. Here are a few suggestions of how brands can do better going forward.
Embrace More Omni-Channel Integration
Digitally enabled brick-and-mortar dealerships have an advantage in customer acquisition up front. Most car searches start with a google search for a few specific models that then trickles down to a visit to clutch.ca, cargurus.ca, autotrader.ca, a number of dealer websites and even corporate brand websites where you can look at a variety of colours and trim options on each vehicle. If done right, customers can be won over quickly in this first and very crucial stage of the sales game. Do you have a social media presence? Are you purchasing google/Facebook ads and geo-targeting your potential near-by customers? Are you live streaming your dealership’s grand opening or special event on Facebook/Instagram live? Is your website set up with a DM chat to answer questions on the spot? If you don’t have a large on-lot inventory do you have a digital kiosk in store that allows customers to explore vehicle options digitally or through some sort of augmented reality? This is how smart dealers are getting more customer traction successfully these days. The tools are cost effective and easy to implement.
Take The Test Drive To Your Customer
One great take away for consumers during and after Covid-19 was the expansion and adoption of home delivery services. Companies like Amazon, Uber Eats, and Caravana thrived during this challenging time because they offered consumers a complete touch-free experience but more importantly, a reliable and convenient way to receive goods without leaving the home or workplace. Consumers began to embrace these types of services en mass and the embraced adoption continues to grow post-pandemic. Some car dealers have begun to offer to take vehicles to their customer’s home or workplace to be tested over lunch or even left behind with the consumer for a few days so that they can now drive it to and from work, to the grocery store or even pile the whole family in for a drive into the country. This is how you truly learn if a vehicle works for your needs.
Take The Show(room) On The Road
The pop-up shop is becoming more and more popular these days for many brands and the auto industry should be taking more advantage of this trend. With rising real-estate costs in most major cities and the footprint of many dealerships shrinking due to lack of inventory or a reduced need for service bay areas with the adoption of more EV vehicles (less moving parts) now is the perfect time to bring the show(room) on the road. Imagine a 10 foot, 20 foot or even a 40 foot metal shipping container or mobile trailer equipped with large windows, multiple interactive kiosks, multiple meeting areas, large TV screens and a few test drive cars parked outside at the next big outdoor event in your town. Maybe it’s dropped into a travel rest area on your way to the cottage and has a hot dog stand attached with a free snack where you sign up for more info, take a test drive and have a free lunch. A mall parking lot could be the new home of this type of pop-up shop for months at a time. The possibilities are endless for this great mobile retail opportunity.?
Meet At The Mall
Can you imagine picking up a few things at the mall then dropping into a dealership along that journey while still under one roof? It’s already happening and it’s proving to be quite successful. Pre-Covid a number of automakers began experimenting with various methods of bringing their cars to places their customers already visit rather than expecting people to come to them. This method took several forms, but they shared a common theme of creating a space where passers-by felt free to ask questions in a low-pressure environment. The pandemic sidelined these efforts for a time but as public spaces reopened it caught on like wild fire for brands like, Nissan, Vinfast, Polestar, Pfaff and Hyundai who have found new homes in malls like Square One, Yorkdale, Markville and Yorkville in the GTA. And of course let’s not forget Tesla who was the first company to disrupt this market being in the mall at Yorkdale mall almost a decade ago.
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Create An Inviting, Modern, Retail Environment
More and more dealerships are getting a facelift to reflect a more modern, minimalistic and elemental environment where the products on display are truly the heroes. High ceilings, modern furniture, open space. Less clutter and natural wood-clad walls and floors to bring in a sense of “warmth” to the sales floor. The shift to modern architecture in most cities is real and that is reflected in the tear-down of old homes and rebuild of new modern minimalistic structures. This is now common in a lot of showrooms across the country and customers feel more relaxed in an open, clutter-free elemental showroom. These new modern spaces are almost like that of an art gallery where the vehicles on the showroom floor are akin to sculptures in a modern museum. The old adage of a “raised perceived value” of products rings true here and that certainly helps in the sale of these high-ticket items.
Get Better At Marketing To Millennials
In 2020 millennials purchased more new cars than any other age group accounting for 32% of total new car sales edging out boomers for the first time ever. For this group of new car buyers the old-school showroom, hard-sell is just not going to work. The disdain for in person negotiating coupled with a heavy-handed online version of tire kicking and price comparison will only allow us to find millennials in the showroom if they absolutely have to be there. This opens up a huge opportunity for a platform that is almost completely online. If the average millennial consumer could compare models, pricing and trim levels online then include price negotiating and financing options as part of that journey that would definitely increase the chances of closing the deal or getting them to the showroom for the test drive and ownership signing. We are talking about a generation that made DMing and texting common place for communication so why not better utilize those tactics in the customer journey to warm up to a potential client and possibly close the deal along that path.
?Face Inventory Shortages With New Ideas and Incentives
With the inventory shortage still being a problem dealers need to be open to giving more incentives to customers while they wait for their vehicles to be delivered. 80% of Canadian car shoppers expect to receive their new vehicle within a month, while 20% expect to wait more than a month, according to a national survey conducted by AutoTrader.ca. Currently, new car buyers must wait anywhere from a few weeks to six months or more to have their vehicle delivered. Of the consumers they surveyed, 16% of respondents would consider switching to another vehicle if their first choice was not immediately available, even if the alternative option is actually their second or third choice. Whether it’s a temporary replacement vehicle, a cash incentive or some sort of rebate on ticket price in some form or fashion, auto retailers need to keep consumers coming in the door instead of them holding off to make their purchase decision.?
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Now that we are back to business at retail we are faced with obstacles and opportunities to create a better customer experience for our clients as marketers, designers and builders. The automotive marketplace has faced a disruption from not only Covid-19 but also by new companies like Tesla and the EV revolution in general. The only way to survive going forward is to evolve and the most successful brands will do that sooner than later.