There is no doubt that the internet is rapidly elevating the savvy of consumers and dramatically changing the auto dealership industry as a result. Shoppers and businesses alike are consuming huge amounts of compiled data online. Why? Because the internet has revealed the inequities and monopolies of not just local marketplaces, but individual businesses…your business.
We complain about shoppers who come in armed with their reports and prices and vehicle histories and rankings and ratings, but they’re growing, not only in numbers, but in the depth of their level of intelligence too. If every consumer were treated equally when buying identical cars there would be no reason for us to protect the details of the transaction and consumers know this. That is why they’re so hungry for the data the internet has made available, aggregated, and cross-compiled in ways that lift that veil.
Without geographical boundaries, the internet has shortened and widened the supply chain. Anyone can find anything online and buy it, without a middle man, at a huge savings. The internet is forcing greater and greater transparency in every industry, and the online-educated consumer (over 80% of car shoppers, according to Edmunds.com) will reward those businesses who meet them where they’re going with their purchase. And, that needs to be you!
Innovation and progress will naturally crush industries that no longer align with adopted technologies…and sprout new ones that do. The entire retail sector has had to add massive online operations, local warehouses, etc. to meet the savvy consumer online. Remember standing in line at Blockbuster every week? Yet, with a local warehousing/home delivery business model, Netflix did Blockbuster in.
The auto industry needs to change the way it operates to survive.
Put yourself in the shoes of the consumer looking for a white 2010 WhateverXL. When you can find one 100 miles away for $600 less, what is going to make you buy at home? The same things that did when you bought cars by going from showroom to showroom: somehow, the local dealer has to convey trustworthiness, quality service, and customer care. How does he do that in the age of the internet? Transparency.
His vehicle display pages show 30 or more photos, including close ups of any scratches. There’s a video of every car. In fact, there’s a video of the finance manager on the incentives page genuinely saying, “Yes, times are tough, but come on in, and together we’ll see what we can do to get you into the car you want.” There’s a vehicle history report and an extended warranty on every used car. There are testimonials from customers everywhere. They say nice things about the dealership on Facebook. And, yes, there is pricing transparency.
To meet those savvy consumers where they are, growing numbers of savvy dealers are using technologies and data just as wisely. They’re attracting educated shoppers while arming their salespeople with the same—and better—information than those consumers bring to the negotiating table.
You have far more data available to you about every customer who visits your website and enters your showroom than they will ever have on you. Imagine how differently you would negotiate if, as you prepare for an appointment with a buyer, you could pull up on your screen that this individual has a credit score of 790, has visited your website eight times in the last month, and, in addition, know all the cars they’ve bookmarked—or even looked at, know what incentives they’ve printed out, what trade in they were quoted by your online appraisal tool, and what other cars are in their driveway. You know how many leads you’ve gotten in the last month on that model that have converted to sales and at what margin. You even know how area dealers are pricing and selling that model. Imagine what you could do with all that information.
Stop imagining and start taking advantage of it.
Jesse Biter is president & CEO of HomeNet Automotive, which makes the Inventory Online (IOL) Internet Marketing Suite of solutions that helps tens of thousands of dealers sell more cars and save time in the process. He can be reached at 877-738-3313 or firstname.lastname@example.org.