Dealers recognise that their overall approach to business is reactive led by the 'here and now'. Arguably a weakness, this short-term approach served many dealers well in 2020. It was reflected in two concerns/priorities that dominated dealers' priorities to COVID-19:
- Staying afloat
- Serving customers well
Reflecting on the publication of the first part of Dealer Pulse 2021, motonovo's Chief Strategy & Marketing Officer Jon Slater highlights a 'Baker's Dozen' key points focussing upon the impact of COVID-19, noting;
"The COVID-19 pandemic has thrown up a massive challenge to the motor retail community. I am delighted that the overwhelming view was that business was a lot better than expected with dealers showing their classic agility across such a broad audience. From the research, we have distilled thirteen key points from dealer feedback that summarises their experiences and views on the implications moving forward."
Changes in the Customer Journey
1) Dealers recognised that customer expectations of online service have accelerated 'by a few years'
2) Click and collect/delivery and remote sales increased noticeably for some dealers. However, the perception was that, apart from lockdown periods, this had not taken off as much as dealers thought it would. The fear of more returns/ buyers' remorse has generally not materialised either
3) Customers are doing more research beforehand: they ask fewer questions once in the dealership and are coming in to confirm things are as expected. Often, final decisions are being made without sight of the car. The amount of selling dealers need to do has been reduced significantly
4) Although not universally desired by dealers, self-service elements in the finance journey are seen as rising
5) Signs of finance competitors being very aggressive with the rates they advertise and with some success
6) Concerns that financially savvy customers will begin to circumvent dealer finance
Used Car Growth Drivers
7) Customers concerned about spending too much on new cars with EV's around the corner
8) Concerns about the future economic climate
9) Moves to avoid public transport
Structural Challenges for Dealers
10) There was an absence of clear digital strategies by dealers to address the trend to online car buying and financing
11) Noticeable staff losses since the first lockdown as the need for physical presence dwindles. Dealers feel even busier and more stretched, an area where digitisation might help
Hope or Reality?
12) The traditional pos model is viewed as fundamental to great service and expected to remain, with digital playing a more significant complementary role
13) Delivery not pervasively implemented or desired, dealers associated it with a lot of set up work and other complications. Dealers do not think it will take over as people generally want to see the vehicle or book a test drive before purchase
"We cannot underestimate the lasting change the last year has had on the dealer model. I do not doubt many people will want to visit showrooms when the opportunity returns, something supported by a yougov survey that suggested 62% of people were not in favour of an entirely online car buying model.
Nevertheless, it still means that a third of people are happy to buy online and with dealers telling us showrooms visits were just to 'confirm things' and with less staff on hand to help, a shift to online, self-serve car buying and financing is set to become increasingly essential. Dealers need to adapt, leveraging the support and help of collaborators."
*Article Source www.rocketperformance.co.uk