Adapting the online customer experience to automotive retail sales
Consumer buying habits have radically changed over the past decade, and we have Amazon, Google and others to thank for it. Online shopping is convenient, and cost effective. We can get what we want, when we want it, and have it delivered to our door. But how does this translate to buying a car—one of the most expensive and considered purchases we can make? Clearly it’s not a new TV or this week’s groceries. Capgemini Consulting has focused on the buying behavior of automotive customers from our first Cars Online study in 1999. Since then, we have seen a steady increase in demand for online sales by our respondents. In December2016, we launched our very first Cars Online Trend Study that explicitly addressed the topic of online sales. In it, 72% of our respondents said they would consider buying their new vehicle online.
Potential for carmakers
The customer appetite for online sales signals a big opportunity for major car manufacturers. 57% of customers indicated that they would like to buy a vehicle directly from an automotive brand’s website. By comparison, there is less trust in tech companies such as Google (11%) or online retailers (23%). But carmakers should not feel too comfortable. Examples such as Alibaba in China or Amazon in Italy show that online retailers are emerging also for cars.
Online-Offline integration is key
Regardless of who is offering new vehicles online, paying attention to the customer experience is paramount. Customers have clear expectations, which include for example price benefits, time-savings and the ability to purchase a vehicle that is not available locally. Additionally, the integration between the online and offline worlds remains the key success factor. 82% of our respondents would rather buy a vehicle offline, if it were the only way to physically experience the product. Also, 60% would not buy a vehicle online, if they did not have the chance to conduct a test drive.
Customers expect a seamless process
Customers are used to seamless one-click-buy experiences. Although they don’t expect that for online vehicle purchases to this degree, a seamless process from the interest phase to the actual purchase of the vehicle is a must. This also takes finance or leasing offers into account. Here, data security and privacy play a significant role. 56% of our respondents demand secure banking options when purchasing a vehicle online. New technologies such as video-ident or others have the potential to provide new security solutions for these challenges.
It’s not just about vehicles
Our respondents clearly stated that they expect more than just the vehicle to be for sale online. Basically everything that might be available at the dealer should be available online as well, with parts and accessories, insurance contracts, service and maintenance packages, and connection services being the most important ones. In addition to this broader product and service demand, our respondents also stated they were interested in alternative and innovative ownership models when buying a new vehicle online, for example, shared ownership.
What happens now?
Based on what we have learned, there are seven steps carmakers should undertake to successfully launch their online sales platform:
1. Integrate the physical and online sales experience
2. Position online channel as an additional channel to the existing dealer network, not as a competing one
3. Simplify and standardize the online product portfolio
4. Provide price benefits and negotiation options
5. Integrate the end-to-end portfolio
6. Build trust and secure data environments
7. Launch mobility options to complement traditional car sales
The time for carmakers to change the business model is now. If they don’t, new market players will.
Download the study at: www.capgemini-consulting.com/resources/cars-online-study