30th April 2018
From estate agency to the insurance industry, the internet has wreaked a disruptive – and sometimes destructive – path through multiple business sectors. What were once solidly bricks-and-mortar industries have come up against a host of online-only competitors who offer today’s time poor consumer a faster-moving and often more cost-effective service.
The world of automotive dealerships might have initially seemed immune to this. After all, if a customer is going to splash out on a purchase as big-ticket as a car, whether brand-new or used, surely they’re going to want to see it in person and enjoy a personalised sales experience?
Not so it seems. As the BBC reported last year, Hyundai, Smart and Peugeot all launched new sales websites, supposedly ‘spooked by the success of car-broking websites’. Meanwhile, the likes of Rockar have enabled vehicle manufacturers to showcase one or two flagship vehicles in locations like shopping centres and hotels, while the bulk of the purchasing happens via online showrooms and digital dealerships.
These new models allow buyers to engage with vehicle sales in a whole new way and are crucially based around an acceptance that a significant element of the sales process now takes place online. They can explore one or two showcase vehicles in a convenient, consumer-focused setting, with experts on hand to talk them through the different options. It’s a model that has more in common with the likes of Apple stores than traditional franchised car dealerships. These businesses are ultimately losing control and influence over vehicle sales – so where does that leave their bottom line?
The importance of aftersales
One areas where franchised dealerships can still deliver an edge over their digital competitors is after a vehicle purchase has been made. After all, buying a car from an expert with a tablet and a model vehicle in the middle of a shopping centre is all very well, but once that car needs servicing, it can hardly be driven back to the same site.
By creating a compelling aftersales service, traditional dealerships can not only shore up their revenue in the short-term, but can also develop a complete customer service offering which can still take direct sales away from those digital showrooms.
Convenience and transparency
How do these dealerships build a superb aftersales offering? There are plenty of lessons to be learned from the new dealership models, which tend to focus on convenience and transparency for the consumer above all else. They choose locations and timings that fit around buyers’ lives, and they focus on providing an expert ‘translator’ between lists of technical specifications and buyers’ actual needs. These are qualities that can easily be built into traditional dealerships, particularly in the aftersales arena.
On the convenience side, opening hours should be structured with consideration for consumers’ working hours, rather than forcing them to take time out of work in order to drop off or pick up a vehicle. Dealerships can even offer their own home pick up and drop off aftersales service.
When it comes to transparency, most dealerships could work harder to offer more of a ‘translation’ service between the checks and processes they carry out on vehicles, and their customers’ expected standards of knowledge. Many drivers have very little understanding of automotive engineering, and can be left understandably bewildered by dealerships reeling off a list of technical checks and presenting them with a bill for parts.
An aftersales experience which takes away that complexity and presents information in a clear, customer-friendly format is a must in order to give busy drivers a top-level picture of the health of their vehicle and allow them to understand exactly where further actions need to be undertaken.
Few business sectors remain untouched by the disruption of the internet, and automotive dealerships are no different. However, by taking the customer-focused qualities that are being exploited by their new digital competitors and applying these to the aftersales side of their business, even the most traditional franchised dealerships can remain competitive.