Dealers Are Asking “What Is Online Retailing, Really?”

In my many discussions with dealers, the one question that invariably comes up is “What is online retailing, really?” They’ll then begin to tell me how consumers can already buy a car online from them. They have a widget with which a consumer can get their trade value. They have an online payment calculator. Customers can submit a lead, get a quote online and even correspond with Internet Managers and then come to a price agreement before they even come into the store ….This is the point in the sales cycle that I like to share what online retailing is to your customers, what they expect and why this heightened experience is getting such huge consumer adoption.


You see, despite all of the technology now available for dealers to use to (supposedly) make online car buying easier, our research has found that this mish-mash of widgets plaguing auto dealer websites simply doesn’t work and actually may cause confusion and offer additional exits from dealer websites, without getting the valuable engagement, trust and lead info.


Sure, I’m told that dealers are getting some leads from them. People are using their trade value tool. They’re converting. I’ll sit back. Listen. Then throw this out there: Our research shows that while your customers are using these tools guess what they then do … they leave. In fact, we’ve found that there is a 200-300 percent ‘missed opportunity’ because of these widgets. Why? For a couple of reasons:


  1. The customer uses your trade-in value widget -- which in many cases is really only a frame-in of a valuation company’s site such Black Book or Kelly Blue Book. They input their vehicle information then discover that their vehicle isn’t worth what they thought it would be – much less in fact. They decide to sell it on Craig’s list …and they leave.
  2. The customer is only interested in a specific car, goes to the VDP page and starts inputting figures into the online payment calculator to find that the payment is too high based on the information they input. We all know that in the ‘majority’ of cases, there are a lot more factors that make a car deal than a singular payment option…and they leave.


These are just a couple of reasons. But if they are occurring on your website, they are causing you to lose opportunities. In today’s landscape, we as dealers must take a hard look at our websites and ask ourselves, “does our site gain the consumer’s trust, simplify the process and make the consumer ‘want’ to engage?”


The reality is that even with all of the technology available, we’re still in a people business. Only a small percentage of customers are going to be OK with the cold and mechanical process delivered by these widgets. On top of this, none of these widgets collaborate. There are multiple pieces for each and every car deal. Without human interaction with a customer during the information discovery process, in the majority of situations, there is no way for a car deal to happen.

Sure, the customer “could” collect each piece of information bit by bit and attempt to assemble a deal structure on their own – this is how much my trade is worth, this is how much my payments should be with this interest rate and this much down. But invariably when they contact the dealership, or arrive armed with the information that your website gave them, we all know what happens. Things change. When that happens, customers get upset.


So, to answer the initial question of what online retailing really is. Online retailing is simply an extension of how we sell cars already -- except it moves that process into a single online experience that is integrated, accurate and builds a relationship along the customer’s journey.


Rather than seeing a customer bounce from your website because they used your self-service trade-in value widget and it scared them off, offer a fully integrated online buying experience that moves them through the sales steps with interaction between the customer and your dealership. Find a tool that is Amazon-easy, yet fully integrated, so it is also Amazon-easy for your team members at your dealership. I believe that the consumer (in 95% of cases) wants to come to your dealership for the full experience. But only after the entire deal is finalized and you have earned their trust and respect. That is part of the fun! It’s all about, trust, respect and simplicity.


The customer doesn’t just want information, they want ACCURATE information and while they may THINK all that matters is how much you’ll give them for their trade, we all know that it’s the whole deal that matters, not just any particular piece of it.


Online automotive e-commerce should cultivate relationships with customers; build trust; create a great customer experience by avoiding erroneous figures or misunderstandings due to generalist information; and allow you to protect your profit margins and increase market share.


You would never pencil a deal and present any single piece of the deal puzzle without knowing the whole picture. But that’s exactly what many dealers are doing online with the many widgets created by coders and companies that have not ever set foot in a real car dealership.


I believe in this great industry and I know beyond a shadow of doubt that we must evolve our digital showrooms to a point where the consumer trusts us, experiences simplicity, and even awe, to the point where they will ‘want’ to engage. Then we must continue that experience at the dealership and employ team members who share that same vision. And THAT is what online retailing really is.

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Comment by David Ruggles on September 29, 2016 at 12:33am

Great article.  Just because the Internet exists doesn't mean we want to throw out everything we every learned about selling cars.  Transparency is providing so much information to a consumer its like drinking from a fire hose for them.  They aren't capable of unpacking the info.  Hell, our own people aren't capable of unpacking it all, especially when you get into the different objectives and tiers of "trunk money."  We'll have transparency with consumers when there is transparency between dealers and their staff, and not a moment before.  Dealers know if everyone in the store knows what the bottom is, there will be a rush to get there quickly out of fear of the consumer.  The factory programs are so complex even the OEM zone offices use specialized software to figure out their own programs.  Transparency my ass. 

But I digress.  If you want to be a fountainhead of knowledge, knock yourself out.  And as the author says, you'll see fewer consumers.  And the ones you will see will be evermore confused.  Hell, they're already getting vonfused at your competitors web site.

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