Consumer interest in buying cars is back to almost pre-pandemic levels, but with a difference. It is now less likely that they will interact with sellers at car dealerships. According to research by McKinsey & Company online buying is now a strong alternative for consumers between 55 and 70 years across regions.
As with all other categories of consumers, auto buyers are increasingly turning into digital explorers. They invest a lot of time researching options, but the content quality is formulaic and staid and fails to engage them. On the other hand, they are wary of visiting showrooms because the term ‘slick as a car salesman’ has come to bear bitter fruit. Many of the disingenuous sales tactics are a car manufacturer’s liability.
Mintel reported that half of the consumers say they are wary of visiting dealerships.
But has the virtual buying experience come of age in the auto industry? No. We are far from that reality. Automotive manufacturers need to own the digital space in a way that puts a new trust value on a consumer’s love for cars. The time has come to make car buyers search less and find more.
Digital gold mining
A digital channel is the new umbilical cord with consumers: it sustains, empowers, informs, and nurtures them. Well, that’s its purpose anyway.
So, ignore it at your peril.
Whether we’re talking cars, motorbikes, specialty vehicles, or machinery, the digital space is the sandbox for car lovers. McKinsey’s Retail Innovation Consumer Survey showed for buying new cars, almost 80 percent of buyers begin their search online, and for used cars, it is nearly 100 percent.
According to an Ernst & Young report, the average automotive customer spends ten hours online for information, deciding when and where to buy the car of his choice. According to a report by consultants Arthur D Little, 70 percent of customers spend more time online than offline.
During these critical on-site moments, are automotive manufacturers engaging consumers with relevant, interesting, and exciting content? Companies that capture leads and grab interest during this highly receptive phase enjoy an unparalleled advantage over competitors.
Here’s the truth: Buying begins on the manufacturer’s website. Customers love to get more tailored information on this platform than a physical experience at a dealership showroom because of the trust factor.
Since customers spend more time on digital platforms, brands need to generate enough influence during the research process, which Google calls ‘Zero Moment of Truth’, to eventually get the customer into a dealership. This transition works better due to the credibility curtain-raiser as a preparatory stage, and consumers feel less exploited as they are armed with information.
Does this mean the information being provided is not meeting this target? Yes. It lags in several aspects, including precise product information, buying processes, explanatory fine print, and building a solid product-to-buyer relationship.
Less search and more finds, please
The role of providing information to automobile purchasers no longer rests with dealers. As a customer gets closer to deciding, the dealer’s position becomes increasingly low wattage; they are no longer the primary source of information.
Customers increasingly use digital devices to research information before visiting a showroom or dealership. Often, this involves visiting manufacturers’ websites, forcing automotive companies to provide more engaging online experiences through personalized content.
The future is here; where are you?
According to surveys, most people don’t enjoy the experience of buying a car; they don’t trust car salespeople and don’t like negotiating.
There will be two significant changes to the car-buying process in a decade, and both are underway. The first involves more options for where and how we buy cars. Dealerships may interest some buyers, while others won’t be drawn to them. That’s a massive change in how experts view auto retail in the US and other parts of the world. As Tesla goes directly to consumers in new-car sales, Carvana is finding digital ways to reach consumers without using traditional car dealerships.
The second significant change will be the buying process, which will become digital and has also begun. By 2030, the entire auto-retail process will be digital, say experts.
It will start with the discovery process — ‘Which car is the right one for me?’ — and end at the sale. In other words, if you don’t want to set foot in an auto showroom, you can buy the car online and have it delivered to your door.
The days of not knowing the car of your choice, how you’ll pay for it – lease or finance – and who your lender will be are fading.
When you go to the dealer, you’ll know what you want, how much to pay, and your choice of add-ons. You will spend significantly less time in the dealership, and traditional car dealers will have fewer opportunities to waylay you. Today, many car-buying margins bulge due to add-ons, and those sales will be much more challenging if the customer knows what they want.
It sounds lovely, right? But there is one critical issue. How good is the content that will make all this happen? Are auto manufacturers gladdening the consumer’s heart with information that tells them what, how, and when to buy and making them feel like valued members of a particular car brand family?
Online content is more than helping car customers with the step-by-step buying process. That’s useful and imperative, and it will transform the car buying experience to align with our digital lifestyles, but auto manufacturers must push beyond. Their content must be an evocative, engaging form of storytelling to embrace the worldview of car buyers. They must create a shared heritage for every type of car buyer through compelling content.
For consumers, buying a car is not just for transportation; it’s an emotional fulfilment, a powerful self-affirmation, and a milestone in their evolution.
So, don’t just sell a car; let your content fuel their dreams.
