By Lori Wittman, SVP Dealer Software Solutions, Cox Automotive
If I had to sum up 2020 in one word, I doubt “highly satisfying” would be at the top of my list. But, believe it or not, that’s exactly how most car buyers we surveyed described their shopping experience last year. According to the data collected from Cox Automotive’s Car Buyer Journey Study, overall buyer satisfaction rates went up—and I mean UP—12% year-over-year to 72%. (For the data nerds out there, this is the first time the industry has ever crossed the 70% statistical threshold!)
2020 was, without argument, the most challenging year in recent memory. So, how can I, or anyone else, wrap their heads around this paradox? One word comes to mind: flexibility.
A Focus on Flexibility
Last year taught (ahem, forced) all of us to be more flexible. Within a few short months, I adapted to divide my work time between my home and office. I pivoted from in-person meetings to video conference calls with team members and dealer partners. It happened fast, but it feels like forever ago. Now, one year later, it’s hard to think about life returning to ‘normal.’
These experiences aren’t unique to me. They’re shared by millions of people. And people are still adapting to change and exploring new opportunities to do more conveniently and digitally. At Cox Automotive, we’re witnessing a parallel. The shift in the automotive industry is still taking place. Our dealer partners are constantly adapting to provide a more flexible, customer-focused buying and selling experience.
This new customer experience is nothing new. In fact, spurred by customer demand, the industry has been slowly moving toward providing a more flexible sales experience that incorporates elements of both online and in-person car buying for years. But 2020 changed everything. It sped up the process and accelerated the inevitable. Today, many customers can’t imagine buying a car without this kind of hybrid experience.
A Car Buying Revolution
To learn more about this trend, I looked at data. I crunched numbers. I read consumer reports. Everything seemed to point to the same thing: a shift in consumer motivations and a desire to spend less time at the dealership opened the door for dealers to adapt to customer demands, resulting in a car buying revolution. Dealers and customers came together to solve a common problem. And in the process, they created a more flexible online and in-store car buying experience.
But looking at data and reading reports wasn’t enough. I wanted to delve deeper. I wanted to know exactly how dealers are changing, how they are adapting and taking advantage of new opportunities. So, I reached out to my good friend, Kevin Frye, who is the marketing director at the Jeff Wyler Automotive Family, one of the nation’s top 50 dealership groups.
Kevin confirmed my initial impressions (and research findings): Car buyers are happier and being flexible and adapting to change are huge drivers. But he also shared several secrets to his dealerships’ success. Interestingly, they all centered around his use of technology in facilitating the type of flexible online and in-store experiences customers demand in the car buying revolution.
Keys to Success: Integration
Kevin’s comments about the connection between technology and success rang true. Dealers shouldn’t be expected to implement change alone. The right technologies can benefit both dealer and customer, and fast track the kind of transformative changes required by a blended online and in-store car buying experience.
Kevin said that the circumstances of the past year led to a dramatic increase in customer demand for a hybrid car buying experience. He saw engagement, leads, and sales with digital tools jump by 150% to 200%. Demand hasn’t come back down in the intervening months, and it’s likely here to stay.
“I’m convinced that … this pandemic was a 10-times multiplier to get the modern-day consumer to engage with our digital retailing tools,” Kevin said.
To help with this increased demand, Kevin and the Jeff Wyler Automotive Family implemented a Cox Automotive Digital Retailing tool, Accelerate, alongside a suite of integrated Cox Automotive solutions — VinSolutions, Dealer.com, Dealertrack DMS, and more. And, the integration between these systems has been key to providing a smooth online to in-store shopping experience for their customers.
“We really believe in the power of integrations, so we’re utilizing a lot of the platforms that Cox Automotive offers,” Kevin said. “What we have found … when we have one user ID and one password that accesses all the platforms, our utilization skyrockets … So, (we have) a much higher utilization rate internally within our dealership, but it also spills over to the consumer experience.”
“We have an integrated platform where information is shared between the platforms simply, eliminating the redundancy of entering info over and over again, (resulting in) a quicker, more efficient car buying experience,” he added.
This experience is consistent with the kind of smooth online shopping experience customers have come to expect. (Think large, consumer-friendly online retailers like Amazon.) Whether online or in-store, modern shoppers don’t want to put up with a clunky car buying experience. If they run into hitches along the way, it’s easy for them to abandon ship and find another dealership to work with.
For the Jeff Wyler Automotive Family, integrated technology that works well together facilitates the kind of shopping experience their customers want and expect. This has allowed the dealership to engage customers throughout the entire shopping journey from start (looking for a car online, for example) to finish (closing the deal at the dealership).
Keys to Success: Engaging Customers
Speaking of customer engagement, the Jeff Wyler Automotive Family uses guided conversations with Accelerate My Deal on Autotrader, Dealer.com Digital Retailing, and VinSolutions Connect CRM and Connect Automotive Intelligence to keep customers interested and involved in the buying process.
Kevin said that the number one impact of these tools working together is improved customer engagement. Shoppers can pencil a deal and move directly into the dealership’s desking tool. It saves time for the dealership and the customer. And, it’s more customer friendly.
After speaking with Kevin, I realized once again — it all comes back to flexibility. Technologies that facilitate flexibility allow customers to freely move from device to device (or from online to in-store) without losing data or time. It also allows the dealership to build value and trust with their customers. In the end, you’re simply earning the right to do business with them now and in the future — something that is particularly important to the Jeff Wyler Automotive Family.
“As a good dealership operator, you want to sell cars to everyone, however they want that experience to be,” Kevin said.
Keys to Success: Personalization
So, where can it all go wrong? And how can dealers make it right? The Jeff Wyler Automotive Family strongly believes that battles for new business are won and lost at the first point of contact with most customers — the dealership website. This philosophy has led Kevin and his team to incorporate a personalized website experience that helps customers get answers to straightforward questions right from the start.
“The modern-day car shopper, in many ways, is no different than the car shopper of 50 years ago,” Kevin said. “They still have three primary questions, which are ‘How much per month?’ ‘How much for my trade?’ and ‘Can you get me approved?’ Is it any coincidence that those are the three primary tools within the digital retailing experience?”
In an environment with fewer in-person visits to the showroom and less face-to-face interactions between the salesperson and customer, earning trust upfront (even at the first point of contact) is the best way to keep a customer engaged and moving through the car buying experience.
To help with this process, Kevin’s team uses Buying Signals, delivered by Connect Automotive Intelligence, to get more information about the customer, including where they are in the car buying journey. This helps the sales staff personalize conversations, pursue appointments, and transition consumers from car shoppers to buyers.
“If the consumer pencils their own deal, leveraging our digital retailing experience, when it comes into the CRM tool, it’s literally just a click of the button to push that information over to our desking tool and pick up where they left off.”
“The same goes whether they did value or trade, got preapproved, whatever the case may be,” he continued. “It’s simpler to use internally with our people and it means we’re not doubling up effort and time with our consumers, giving them the optimal buying experience they’re looking for.”
Keys to Success: Simplification
All in all, the biggest overall benefit of a complete retail experience is that it simplifies the car buying journey from beginning to end for both the dealer and customer. Customers can buy a car the way they want, wherever they want, without having to deal with the headaches of antiquated technology. And for dealers like the Jeff Wyler Automotive Family, simplifying the process means happier customers and more car sales.
Kevin said the Jeff Wyler Automotive Family dealerships have seen 22% more gross per unit on digital retailing experience deals because consumers are willing to pay for convenience. It’s the same reason people pay more for a gallon of a milk at a convenience store as opposed to the grocery store. And when they have options that are easy and intuitive, car shopping becomes fun — something they can do in their spare time. It becomes something they can control.
“When our shoppers engage with the digital retailing experience and they pencil those deals, less than 15% of them ever change the selling price,” Kevin said. “I’m convinced it’s because consumers are willing to pay a premium for convenience.”
“Dealerships have always jealously guarded having control of the process,” he added. “I believe with digital retailing, when we’re giving them (consumers) the abilities to start penciling and desking a deal, and we’re giving them some control over the process, they’re rewarding us by giving us more money for those cars.”
Benefits to Both Customer and Dealer
They say hindsight is 2020. (OK, maybe it’s too soon.) But, I’m starting to see the big picture here. It’s apparent that the shift to a more flexible, customer-focused sales experience is beneficial to both the customer and the dealer.
It’s a major shift for automotive retail. A revolution even. And one that was accelerated by unforeseen circumstances. But for the most part, dealerships have embraced the move. As I mentioned earlier, despite a year of difficulty and extreme change, the data proves that customers are more satisfied with their car buying experiences than ever before. And, dealerships like the Jeff Wyler Automotive Family are reaping the financial rewards, brought about by new opportunity and increased customer good-will.
Bringing about this kind of revolutionary change is an incredible accomplishment for our industry in any environment, let alone one that had as many obstacles for dealers to overcome, as was the case in 2020. And though some dealers are still working to adopt these new technologies and business practices, I think the entire industry should be commended for their flexibility and willingness to personalize car buying for customers in such a short amount of time and under such trying circumstances.
Conclusion
As a dealer, how would you describe your 2020? Even if “highly satisfying” aren’t the first words that come to mind, I hope you’ve found new opportunities in a year of rapid change. Hopefully, you’ve found ways to open new doors (despite perhaps closing some physical ones temporarily) to deliver the kind of optimal, flexible car buying experience your customers expect.
Like the Jeff Wyler Automotive Family, I encourage you to embrace the move to a hybrid system of online and in-store sales. Remember, you don’t have to do it alone. Implement technology that prioritizes integrations, flexibility, simplification, and the ability to keep customers engaged. Embrace technology that will benefit both your customers and your dealership, giving your customers a more satisfying buying experience while boosting your bottom line.
At Cox Automotive, we take pride in our ability to understand common dealership issues and to help you solve them. Moving forward, I invite you to tune in to my new video series, Dealer Advantage with CBT News. I’ll continue to sit down with dealers, like you, to give you a window into the industry and insight into the practices and technologies your peers are using to overcome challenges and find lasting success.