When it comes to digital retailing in the automotive industry, there's a definite disconnect between what buyers want and what dealerships offer. According to a new Equifax survey, one thing dealers aren't offering that many buyers want is a completely digital car buying experience, from start to finish.
Digital Retailing off to a Good Start
Many dealerships have transitioned much of the car buying process to a digital one, but, in the majority of cases, there comes a time when a digital transaction must move offline, much to the customer's chagrin.
"There remains a distinctive gap in what dealers are currently offering and what car shoppers want when it comes to the realities of digital retailing," said Jenn Reid, Equifax's vice president, strategy and marketing leader, automotive. "Clearly, there is a lot of room for improvement in speeding up the transaction process and offering a complete online transaction solution."
In a recent online survey, Equifax polled 135 dealers across the US to gather an understanding of a number of current trends, and to determine how far these dealerships had streamlined their online digital retail operations.
They found that one of the biggest problem areas for dealers continues to be the transaction time – especially in the F&I process. Of the dealers polled, 45% said the process still takes between one and a half and two hours, while 31% said it can take up to two and a half hours to complete a deal.
When it comes to offering services digitally, while a majority (84%) of dealers polled said they offer appointment setting online, only 27% said they can get a deal done totally online – despite the fact that 87% of dealers said their customers prefer to complete deals online.
Potential for Stronger Profitability
The Equifax survey isn't the only thing that has recently shed light on the subject of offering what the customer is seeking. According to WardsAuto, some attendees at the 2019 Ethical F&I Managers (EFI) Conference – a recent auto industry event in Denver – felt that relying on digital retailing for things like selling F&I products is only going to reduce dealership profits.
Cox Automotive's senior vice president of product and engineering, Kelly Mulroney, told the conference otherwise:
"Our research shows (online) auto retailing brings stronger profitability," said Mulroney. She added that it engages customers early, and allows them to shop the way they prefer.
Echoing the sentiment of the Equifax survey, a study from Cox shows that 83% of consumers say they're more likely to buy from dealers that give them the ability to complete most of a purchase online.
Like Equifax highlighted in its survey, despite what the customers want, stores are hesitant to move in that direction. When Mulroney asked the EFI Conference how many of its dealership websites include an F&I section, only one audience member raised their hand.
"The F&I office should have an online presence. Digital retailing can help you do your jobs more quickly and readily," Mulroney told conference attendees.
Mulroney also cited Cox Automotive data, stating that 63% of customers are more likely to purchase F&I products if they learn about them online first.
"They feel more informed and more willing to buy," she said. "Bring F&I to customers where they are: online at home or on their phones. The store becomes an extension of online, and not the other way around. That's how customers think about it," said Mulroney.
What Does This Mean for Your Car Dealership?
As you forge ahead and begin thinking about what digital retail might mean for your store, consider small steps at first. You don't have to dive into this new retail process all at once, but you should be getting your feet wet.
It's clear that customers in current generations are pushing to get things done on their own terms. What they want is a completely online car buying process. But maybe you're not there yet, and that's okay. While you're planning your next steps in the digital world, why not get a little help bringing in prospects that are ready to buy?
Here at Auto Credit Express, we offer a wide range of services that can help ensure customers are coming into your showroom eager to get the car buying process rolling. These leads are starting the process from our website, and we can send them through your doors. We've been a leading force in the subprime market for over 20 years, and now offer new and used car leads through our partnership with CarsDirect Connect.
See which of our many dealer products and services are right for you by calling us at 888-535-2277. Or, you can fill out our contact form online, and a representative will be in touch. Don't delay, boost your store's leads with us right now!