Cox Automotive has been conducting the Car Buyer Journey Study for the past 14 years to determine the key changes in consumer buying behavior. The study was conducted from August to September of 2023, with nearly 3,000 respondents who purchased or leased their vehicles within the previous year.
Autotrader, Dealer.com and ESNTIAL Teams
As the majority of us know, there are really big benefits to both having and collecting first-party data for your business. Think of your contacts, your customers, your leads, your website, your insights, your predictions… Everything that you have been collecting since the day your doors first opened and website went live at your dealership.
Your revenue sits in that first-party data. Or more importantly the strategy tied to it. And you can unlock many benefits and advantages by learning new ways of how to activate that data. Especially with a cookieless future quickly approaching on the horizon. In an ever-shifting automotive industry and world, your first-party data will help you stay a step ahead.
When it comes to your business and marketing goals, it’s essential to understand and map out where your dealership or brand is today, and where you’ve set your sites on going. Data can and should be a leading driver to help you successfully do this.
So together, let’s take a closer look at how your activated data can help you stand out to your ideal customer in your marketing efforts, mix-match-modernize your strategy, and help you map out your step by step as digital retailing and our industry bridges towards an eCommerce future.
Part of activating your data is interpreting and acting on the insights, especially when it comes to what your consumer wants, needs and prefers. However, your existing methods of activating your first-party data don’t quite work the same way anymore.
It’s time to revamp your strategy to accommodate the changing landscape of the industry and connect to new shopper insights.
Educate and Demonstrate: Remember, how we do business, where we do business and who we do business with has and will continue to shift. You need to make sure that your marketing strategy includes educating and demonstrating to the consumer you have the cars, service, experience and capabilities they want and are willing to show them how to use them.
Some of these consumers will be existing customers, but they might need reminders of how your business has evolved. And some of these consumers will be part of the heightened 56% of cross-shopping auto buyers who are open to and entertaining a different brand and type of car. Educate and demonstrate the advantages of doing business with you and what makes your brand the one they should choose. They’re new and haven’t had the first-hand experience yet, so give them the virtual experience and highlight hallmark values and experiences your brand offers.
Communicate the Way They Prefer: If you’re not communicating the way your consumer prefers, you are definitely missing out on business and probably losing some of your current customers. This year’s Cox Automotive annual Car Buyer Journey Study revealed that for the two growing segments of in-market auto shoppers, their preferences for communication steer them towards who they ultimately decide to do business with.
And what they prefer when it comes to communication is ease, a frictionless experience, and in their preferred method. For many that means texts, having chat available on your site, and instant buttons so they can quickly complete their desired actions.
Shifting Parts or All of the Car-Buying Process Online: Both of the growing segments of auto shoppers surveyed in the 2022 Car Buyer Journey Study said they prefer to buy online – with 75% of them saying within the next 5 years they would buy a vehicle entirely online. They’re a growing target, currently completing 10 out of 13 of the purchase steps online.
It’s an Amazon buying world. Consumers are open to and moving toward being more comfortable with buying high ticket items online, like cars, predominately online as well. Look at what you currently offer with your digital retailing tools and map out what steps you still need to go towards a fully eCommerce future. We have a few suggestions and items to consider when doing that below!
Rome was not built in a day, but it was built brick by brick. And so should your digital marketing strategy – lean the most on your first-party data to be your bedrock foundation and the digital retailing tools you have supporting, feeding and connecting your customers to what they want and need.
Digital retailing tools continue to grow and expand how auto dealers do business and plan their marketing strategies. This digital foundation was laid in our industry during the pandemic with the goal of a better shopping experience. As satisfaction levels continue to likewise grow with the online experience, so should your focus on adding more digital retail solutions and capabilities as well as connecting them with your first-party data to help drive your business.
The new speed of retail is here, and shoppers expect a streamlined, digital experience. So, to help you meet them where they are, it’s important to take a look at where you are.
Whether your dealership is on the low end of the eCommerce spectrum only offering a few digital retailing tools, or are fully automated and full-spectrum eCommerce ready, there are distinct advantages to mixing, matching and modernizing your digital retail strategy. And first-party data should be the core pillar of how you’re connecting it all and moving forward, especially in a cookieless future.
As we touched on before, by alleviating your consumer’s pain points, and activating your first-party data with personalization, you’ll have the ability to not only stand out to your ideal customer and retain existing customers, but you’ll also have the ability to improve your customer’s experience in the following ways reported in the annual 2022 Car Buyer Journey Study. In a cookieless future this is where your revenue will have the ability to grow.
By connecting your first-party data to your existing and future digital retail tools, you’ll not only give your consumers what they’re looking for, but you’ll set yourself up for increased exposure and reach, the ability to turn vehicles more quickly, increase your opportunities for acquisition and inventory and close more deals. More specifically… profitable deals!
There is often confusion when it comes to the differences between digital retailing and eCommerce. While they both start online, that’s where the similarities both begin and end.
Digital retailing helps guide the overall experience for your shopper and saves time for both you and the consumer. Your customers can easily navigate and engage with your website during different stages of their purchasing journey.
Digital retailing: Largely supported by a person at your dealership: There are many steps that digital retailing can connect. For example, the consumer starts the deal online and can take it to a credit app submission, sometimes even a credit decision, but at that point dealership personnel will need to engage with the consumer to walk them through the deal. So, while technology plays a big role, the process is largely supported by a person in the dealership.
eCommerce: A fully digital transaction: On the other hand, eCommerce also begins with the consumer starting the deal online. But the key difference is that a consumer can take a self-paced fashion, working through the deal all the way through digitally signing the contract package and scheduling the delivery of the vehicle. The process is also supported by F&I automation primarily, not dealership personnel. Most dealerships have dedicated eCommerce teams who solely focus on these end-to-end online transactions.
If adding an eCommerce channel isn’t feasible in the near future, digital retailing can still satisfy those digitally savvy shoppers. Consumer research confirms that not every consumer wants the same results from their online experience. In fact, 9 out of 10* prefer a flexible, personalized buying experience. Make it simple for customers to explore the information they are comfortable researching (inventory, trade-in values, financing terms/payments, F&I products) and move the process to the dealership when they are ready.
Aside from leveraging digital retail and eCommerce solutions to provide seamless transitions between digital and physical interactions, training your entire team (not just your BDC) on switching between online and offline interactions goes a long way. You’ll see increased confidence, improved satisfaction and the consumer will appreciate this more personalized and efficient way of doing business.
A cookieless future isn’t as worrisome when you put your first-party data to use. By revisiting your current marketing strategy, mixing-matching-modernizing your digital retailing tools to connect them to your data, and planning everything your dealership does from the top down on how you’ll grow your eCommerce business, you’ll stay a step ahead of your competitors and align your dealership for success in the future.
As technology continues to evolve, activating first-party data is essential for every auto dealer, whether your business is brick-and-mortar or strictly eCommerce. You’ll gain insights into consumer behavior and preferences, improve customer experience, and optimize your marketing campaigns and dollars.
It’s time to start shifting from just collecting first-party data to activating and connecting it. Because when you do, you’ll quickly see the difference it can make for your business to increase conversions and your profits.
Cox Automotive has the most connected and comprehensive view of the automotive industry and offers unmatched data and insights into consumer behavior, automotive trends, and operational best practices. Whatever your goals, we can help you get there faster to stay a step ahead and successful in today’s marketplace.
Current inventory shortages have caused dealers to look inward to find other sources of revenue. The most natural place for most dealers to look is the fixed ops department, which accounts for about half of the average dealer’s revenue, but only about 1/10 of the overall marketing focus.
Dana Ayer, manager of Performance Management at Dealer.com, recently spoke to dealers about how to find hidden profits through fixed ops merchandising. He shared how dealers can increase customer engagement, boost auto sales leads, and drive revenue with the right fixed ops messaging. Key takeaways from the presentation included:
Watch the webinar to see how your dealership can drive operational efficiencies, outpace your competitors, and improve profits by amplifying your fixed ops messaging.
With the chip shortage forecasted to continue, every dollar of revenue matters. And while you may think you’re already getting every dollar out of your dealership, you’re probably leaving money on the table in your service department
Join Dana Ayer, Performance Management Manager at Dealer.com, you’ll learn about website marketing best practices, key Cox Automotive integrations, and other actions you can take to amplify your fixed ops messaging to find more profits.
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The pandemic accelerated the rate of consumer adoption for many online shopping experiences, from ordering takeout to buying groceries. Automotive retail was no exception as car buyers showed increased interest in shopping and purchasing cars online.
In this session, we’ll discuss the new and evolving expectations of your digital retail shoppers. You’ll learn how to adjust your processes, make better customer connections, and close more deals.
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The pandemic drastically changed the habits and expectations of car buyers. With shoppers spending more time online, it’s becoming harder to differentiate your business from the dealers down the street. To keep customers—and their dollars—coming your way, you’ll need to adapt and implement new digital shopping experiences that your competitors can’t match.
During this session, we’ll share key insights and best practices for creating easy, fast and frictionless car buying processes. You’ll also learn how to market and communicate those experiences with a multi-channel digital marketing strategy.
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The “Cookiepocalypse” is coming, but is your dealership ready? The digital marketing landscape is about to turn the advertising landscape on its head—while eliminating the tools you’re using today to target customers online. Google and other web browsers have agreed to eliminate third-party cookies, or the little packets of data that websites deposit on your computer as you browse.
Join Noah Lee to learn everything you need to know to navigate the transition away from third-party cookies while thriving in a new era of online advertising.
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Today’s environment is challenging. The 2020 Cox Automotive COVID-19 Consumer Impact Study reported we’re dealing with tight inventories as well as fewer in-market shoppers — 20 percent of consumers were in-market to purchase a vehicle in March, while early August reported 15 percent in-market. To combat numbers like that, you need your digital marketing on-point and working for you.
Fully optimized digital marketing will drive in-market opportunities to your website and generate sales and service leads for your dealership. Let’s talk through the digital marketing hurdles you must face head on right now — and how to clear them for your dealership.
Hurdle 1: Expertise
Digital marketing is comprised of vast, highly specialized skill sets, and with 49 percent of businesses increasing digital marketing efforts in the wake of 2020, you need experience and expertise stay competitive.1
It takes a lot of time to read all the marketing blogs, evaluate social media platforms, and anticipate and prepare for algorithm changes. Not to mention, studying your analytics to inform changes to strategy amidst shifting priorities and challenges. You may be able to check some digital to-dos off your list, but if it’s not your primary job, can you give it the time and attention it needs? Look for a partner that specializes in core digital marketing fundamentals, with deep knowledge of the automotive industry, to help you stay ahead of emerging trends and ever-changing best practices.
Hurdle 2: Resources
We are all trying to do more with less today. This year has forced you to create necessary efficiencies at your dealership, and an unintended consequence might be fewer digital marketing resources. This comes at a time when you need your sales and service messages to stay relevant in a highly competitive search environment while also creating new messaging to ensure shoppers understand the new digital sales and service processes you’ve put in place in order to help them, and your employees, stay safe.
The good news? You don’t have to do it all yourself, nor do you have to invest in costly agencies. Look for a digital marketing company that puts a team behind your dealership to work with you and expertly execute your digital marketing strategy.
Hurdle 3: Multiple Vendor Relationships
Digital marketing efforts should be connected. If you’re working with several vendors, you may not reap the benefits of a single, cohesive strategy to tie your digital plan together. There may be other pitfalls too, like an unclear ROI for your marketing dollars and differing KPIs that make performance difficult to judge.
Instead of juggling multiple technology vendor and marketing agency relationships, look for a solution that brings it all under one roof, with one point of contact. You need a single solution accountable to you as a true partner in your success. With a vendor like that, you get time back that was spent communicating across disparate providers and better results because you are more effective when discussing goals and strategy with one person, one time versus multiple people multiple times where important nuances may be missed.
Hurdle 4: Specialized Skill Sets
There are several disciplines within digital marketing that work together to create successful, polished campaigns. Most marketing professionals only specialize in one or two disciplines, like copywriting or SEO. It’s understandable the array of skill sets needed to write and design your creative, optimize your SEO, manage social media, create a competitive advantage with your online reputation, or even develop video content may be difficult to find in one person or even across your dealership.
Put a team behind your digital marketing with all of those skills for a cross-coordinated effort. At Dealer.com, you have one point of contact, your performance manager, whose job is to help you obtain your goals. They do that through coordination with accomplished, specialized automotive marketers with the know-how to help you attract high-quality, in-market shoppers through optimized organic search visibility and a consistent look and feel across all digital channels.
Your digital marketing success starts with the right team. Let’s talk about stellar results for your dealership. Visit dealer.com/a-team.
1Digital Marketing Institute Whitepaper: Digital Paves the Way in Response to Covid-19
Thanks to an environment of social distancing and ever-changing ordinances, your dealership undoubtedly looks different than you expected it to at the beginning of the year. While there have been many barriers to success in the car business this year, several silver linings have emerged as well.
The rapid shifts in the automotive retail industry – and the world in general – have created opportunities for your dealership to leverage technology to ensure business continuity and prepare for a more digital future.
Challenge yourself and your team to see the silver linings of this challenging time, including these three for your dealership digital marketing department.
Digital marketing becomes more effective the more accurate data you have, and your customers are giving you more and better data as they shop and buy online. According to the 2020 Cox Automotive COVID-19 Consumer Impact Study, 71% of shoppers want to do more of the purchase steps online compared to the last time they purchased a vehicle.
Customers have long wanted a personalized car-shopping experience, and that experience starts with targeted, relevant marketing. With more of the buying process now taking place online, customers are giving you more details digitally about what they are shopping for in their browsing behavior, including alternative vehicles of interest and payment options. With that new abundance of rich data, your dealership can personalize emails, website experiences, and more – quickly, efficiently, and at scale.
While increased online shopping and purchasing helps your dealership collect more data, it is efficient, integrated tools that help translate that data into bottom-line value for your business. Many valuable dealership marketing solutions, including video advertising and automated website experience optimization, already exist and are delivering results for digitally forward dealerships.
Over the last eight weeks, dealers using video to present additional service recommendations to customers earned an average of more than $4.4 million in incremental fixed ops revenue, according to an analysis performed using 1,700 Xtime Spectrum Inspect dealerships. In addition, the number of shoppers submitting digital deals increased 108% from January 2020 to May 2020, according to Internal Consumer Use Data from Cox Automotive Product Analytics.
We’ve seen that customer data and technology have proven to boost dealership results. Despite this, there are dealerships that still aren’t ready to make a long-term commitment to digital-first operations. Cox Automotive’s 2020 COVID-19 Impact Study indicates that half of dealers are considering going back to their old, non-digital methods once their communities “go back to normal,” despite overwhelming consumer preference and increasing gross profits associated with a more digital process.
This means that your dealership has an opportunity to be set apart from the competition. Now is the time to quickly and intentionally implement the digital tools that will improve efficiency and customer experience. The truth is there is no “normal” to return to. Consumers now expect a faster, more convenient, digital experience when they buy or service a vehicle, and dealerships that recognize that now will be the ones who win long-term.
Transforming an industry is hard, but you can do this! From the rise of the internet in 1999, to the Great Recession of 2008, to the crippling recalls of 2016, this industry has proven its resilience before. With a focus on these silver linings, you’ll continue to succeed by adapting to meet car buyers and service customers wherever and however they want to engage you.
To learn more about how to move your dealership forward, download the Digital Marketing Playbook or contact your team of Cox Automotive Performance Managers.
