SA’s Car Dealerships ‘Must Speed Digital Transformation’
South African car dealerships must speed up the evolution of their ‘digital dealerships.’ This will help them stay abreast of raised consumer expectations, create better customer experiences and run leaner, more efficient operations.
While COVID-19 made many dealers aware of the need to increase their digital presence, many have simply been transferring some elements of their traditional brick and mortar businesses to online digital platforms, without embarking on a full transformation, says Kriben Reddy, head of TransUnion’s Auto Information Solutions for Africa.
“Consumer expectations had already changed before COVID-19. They have an infinite amount of choices, which means they can demand instant fulfilment, personalised experiences and more control over the buying and selling process. Simply advertising your stock on Facebook, and calling yourself digital, just doesn’t cut it,” says Reddy.
There are several steps local dealerships can start taking on their digital journey right now, says Reddy.
Reach Your Customers Where They Shop
Research suggests most vehicle buyers use digital channels as a source of information. They start their research online, and not a dealership floor. According to AutoTrader’s 2020 Car Industry Report, there were 401 million online searches for vehicles in the past 12 months. What this means is that when buyers make it to the dealership, they already know exactly what they want to buy.
“All this information that buyers are gathering online isn’t just helping shape their decisions: it could end up driving them into your dealership. So when you’re looking to reach new customers, reach them where they’re spending time: online,” said Reddy.
Omni-channel means offering a consistent, seamless experience across the physical and digital worlds. To trade successfully in a depressed car market, it’s vital to create an omni-channel strategy that provides the ability to capture potential buyers through a range of digital and traditional sales channels. Customers should also be able to switch between information sources and get a consistent brand experience.
Use Interactive Consumer Experiences
Nowadays, consumers don’t just want to see a series of photos of the car: dealers should be thinking about video and virtual car tours as well. “Through video, potential buyers can now experience parts of the shopping journey that previously could only be done at the dealership, including vehicle walkarounds, product demonstrations, and even video test drives,” says Reddy.
Keep the Customer Satisfied
Customer service is just as important as ever. In fact, some still consider it the most important factor when buying a car, says Reddy. “The message is clear: even though the fundamental experience of buying and selling a car is changing, warm and engaging customer interactions are what keeps people coming back.”
Take the Friction out of the Process
Modern customers are many things – but patient isn’t one of them. Consumers want to buy a car as fast as possible, so it’s vital that dealers are able to offer a quick, keen trade-in that makes the customer feel they are getting a good deal, and make the right offer at the right time.
“Gone are the days of prospective customers entering a dealership, seeking advice from a salesperson, taking a test drive, waiting up to 24 hours to negotiate a price for their trade-in, and waiting another 24 hours to agree a finance deal before placing an order. Increasingly, dealers get just one chance to strike a deal, so they need to be able to make an offer and create a deal almost on the spot,” says Reddy.
To help dealers respond as quickly as possible, TransUnion has just released a new tool for dealers, Car Price, that provides real-time information on car prices, both from a trade-in and a resale point of view. Reddy says Car Price is designed to supplement the traditional ‘blue book’, by adding leading indicators to the book’s existing indicators to provide an instant view of pricing.
“Simply put, the dealer pricing tool removes the need to scan the car platforms looking for price levels and presents a simplified visual tool to price cars. It’s based on live data and updated bi-weekly, which means the market price indicator is now supported with actual underlying data that will allow you to minimise error and price quickly and efficiently,” said Reddy.