Has the Novel Coronavirus Sped up the Adaptive Process for Dealers to Scale Up DR?
We’ve been blasting calls to dealerships lately in order to get some insight as to how the current epidemic is effecting consumer behavior. As one would expect, the results are variable depending on the market. This past weekend saw some many dealers at or near par, and others down by double digits, nothing new there. It isn’t catastrophic yet, but it’s not trending favorably, especially with mandatory shutdowns looming and in place. Foot traffic was down everywhere, but online engagement increased as would be expected. But for dealers experiencing far less foot traffic, and not set up for state-of-the-art digital retailing, sals may be lost in the turbulence of inefficiency.
Why are car sales not falling through the ice yet?
It’s quite possible that the sales we’ve seen reflected during the last couple weeks are indicative of individual buying cycles that began several months ago and simply culminated over the last couple weekends. As the crisis grows, the slow down in transactions will be more akin to a ceiling fan that gets turned off and takes time to come to a complete stop. Hopefully, something will flip the switch back on before that happens.
Necessity is the mother of invention, and this crisis has shed some light on the real future of automotive retailing.
Those dealers whose websites have been modified or rebuilt to accommodate digital retailing platforms should be seeing an uptick in activity right about now. People are resistant to leave the safety of their homes, let alone drive into a car dealership and have to face off with any number of potential disease vectors for what is usually a long period of time. It’s no longer a preference, rather a necessity to reduce “perceived and real risk” during this period to buy online and avoid human contact.
Several dealers I have chatted with are actively engaging folks to transact online, but they’re freestyling it, and not using any particular digital retailing platform so the constant back and forth of docs and questions may feel clunky and time consuming. Some are assuredly warming up to the inevitable truth that online car buying will be the preferred method of car buyers possibly much sooner than later.
Just 4 short weeks ago at NADA, digital retailing sounded like an ancillary model for the future.
Everyone was still waiting to see which platform would deliver the best results. Webbuy had some very impressive numbers, but no one else was all the too forthcoming with a case study, at least when we asked. Many of us thought that DR was going to be commonplace somewhere down the road. No one expected it to be at the next Stop sign, but here we are. This “crisis” is unquestionably an anomalistic one in real-time, but it shows why having a customer friendly, seamless DR solution is an absolute must.
How long will this nightmare last, it’s hard to say. Will digital retailing-based transactions reach 10%, 20%, or 25% of some dealership’s sales in the next several months? That all remains to be seen. I don’t think it will, but I do think that those pushing digital retailing should take advantage of the current chaos and start charting activity now so they have something to show dealers when the time is right. Meanwhile, keep on marketing. Slow downs are no time to slow down!