Tag: Automotive Retail

Disruption Today: Drive Profitability with Emerging Technology

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Based on the workshop presented at NADA 2019 by Mike Barrington, Senior VP of Retail Solutions Group Sales, Digital Retailing & Dealertrack F&I Solutions at Cox Automotive

The rate of technology change today is astounding – and the adoption rate is matching its pace. Not long ago, some of the technology we take for granted today sounded like science fiction. Today, we all carry powerful pocket computers that also happen to be phones, many of us have digital assistants that respond to spoken commands to do things like order groceries, and cars can talk and nearly drive themselves.

Consumers are already using the latest technology in every aspect of their lives. What you might think of as the “cutting edge” of technology is fast becoming the new normal.

Consumers expect their car-buying experience to be as convenient as the rest of their tech-enabled buying experiences. Unfortunately, dealers are already falling behind.

As an industry, we need to create the better, more transparent experience that consumers demand. Here are two major emerging disruptors that will impact the way dealers do business in the near future.

  1. Digital tools to enhance the consumer’s buying journey

Consumers want to be able to choose the points in which they interact with you online or in your store. Having an online presence is a given, but today you must enable the consumer to do a significant portion of their research and buying process online.

This doesn’t mean that the consumer will stop coming to your dealership.  In fact, we know that the majority of shoppers prefer to finish their transaction in the dealership.

However, we know consumers demand more digital tools than ever before. Providing those tools gives you the competitive advantage.

For example, 83% of consumers want to learn about F&I before they visit the dealer, and they are more likely to purchase products that they’ve learned about in advance.

This is a big area where dealerships are falling behind the technology curve. If you don’t have a strategy to provide digital retailing tools, you’re already at a disadvantage.

  1. Proactively communicating with customers on their devices.

Just a few years ago, consumers thought that personalization and online targeting were “creepy.” Now it’s just an expected part of business interactions.

Think about retailers like Starbucks or Amazon that not only connect online experiences to the in-store/in-person experience, but also use their consumers’ data—backed by machine learning and AI—to continually build on their previous shopping behaviors. This helps them connect shoppers with what they want, when they want it.

Essentially, marketing is now a service that efficiently helps consumers find the things they need and want. Dealers who are ahead of the curve are leveraging this technology to deliver messages to consumers with the right context:

  • The product or service that matches their needs,
  • At the time they are looking,
  • With the right information to help them make a decision about taking the next step.

They are delivering a value add, by helping the shopper find the product they need – and they will be rewarded with more traffic and sales.

What dealers can do to stay ahead

Now that you have a better understanding of some of the disrupters in our industry, let’s take another look at the some of the ways in which consumers are interacting with technology today:

  • They use an app to order their coffee.
  • They use another app to order their weekly groceries.
  • They join monthly subscription services so they can have someone shop for their clothing, makeup, pet treats, razors and more.

The trend is that consumers are using technology to save them time and get them exactly what they want. That means dealerships need to think about how they can make the current car-buying process more digital and efficient.

Here are some things we know about what your customers expect:

The role of technology

When you’re examining the technology you use in your dealership, the goal should be to make each customer’s visit shorter, more efficient and more enjoyable. Increasing internal efficiency is one way to do this, but it should be done with a focus on enabling customer relationships at each stage of the deal.

To deliver against consumer demands, you must be willing to shift your current operations, become forward-thinking about your technology stack, and build the right foundation.

You can use this period of disruption to your advantage—and remain competitive and profitable.

 

The Consultative Approach to Selling

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by Mo Zahabi

While digital retailing in automotive is on the rise, dealership staff still play an important role in customers’ car-buying experiences. Six in 10 consumers would still want help from dealership staff even if they could purchase online, according to the Cox Automotive Future of Digital Retail Study.

But the roles of the salesperson and F&I manager have changed. In the past, dealership staff were only there to make money off a customer. Oftentimes, the customer knew more the vehicle than the salesperson. Today’s dealership staff, on the other hand, have responded to customer needs and shifted to a much more product-oriented approach. According to the same Digital Retail Study, today’s car buyers prefer staff who are product specialists – people who are highly knowledgeable about features and technology who will also act as consultants and listen to their needs in a low-pressure environment.

This consultative approach is particularly important in F&I, where consumers are critical of the traditional pitch, according to the 2015 Digital F&I Experience study. To connect with your customers – and make the sale – you have to take a more personal, friendly approach to F&I selling.

Empower Independent Learning

In the old approach to selling, there was a one-way flow of product information: the salesperson would tell the customer information as they sat in front of them. It was a belly-to-belly, in-your-face approach. But today’s consumers are hungry for resources that allow them to do their own research. 71% of car shoppers would prefer to do F&I research at home prior to purchase, and 63% say they would be more likely to purchase F&I products if they had the option to learn about them before finalizing their vehicle purchase, according to the Cox Automotive Maintenance & Repair Study.

Consider offering F&I product information on your dealership website, and also give your customers opportunities to do their own research once they are in your store. Mobile menu selling solutions, like Dealertrack’s eMenu for iPad®, enable independent customer learning. These technologies allow you to load a tablet with key F&I product and payment info, giving customers the opportunity to digitally explore your F&I offerings on their own – and better understand the value of F&I products.

Sit Shoulder to Shoulder

Most people use the phrase “shoulder-to-shoulder selling” figuratively, and that imagery is important when thinking about your approach. Customers need to know you’re not selling at them, but consulting with them. But the literal sense of the phrase is important too.

Literally sitting shoulder to shoulder with your customer as you review F&I product information can change the entire mood of the presentation. Without the physical barrier of the desk, the “me vs. you” mentality that can leave customers feeling intimidated in the F&I office is removed. Consider implementing menu selling technology that is specifically developed for tablets like Dealertrack’s eMenu for iPad®, which enables you to sit shoulder-to-shoulder with your customers – figuratively and literally.

Leverage Your Network

Today’s customers know there are many options for everything they can buy, and they want to know that they’re getting the best option available. Make sure you’re familiar with the network of aftermarket providers powering your dealership’s F&I selling solution, and don’t be afraid to explain to your customers where your product offerings are coming from. They’ll appreciate the transparency, and an increased understanding of how the process works certainly won’t hurt your chances of making a sale.

A version of this post originally appeared in Digital Dealer.

Watch this video to learn more about how Dealertrack’s eMenu for iPad can help you implement a more consultative approach to F&I selling.

Mo Zahabi is the Senior Director of Product Consulting at VinSolutions and Dealertrack F&I, where he educates dealers on best practices and ensures their offerings exceed industry expectations. Mo has applied his strong foundation in technology-based applications to the automotive industry for the last 18 years. Prior to joining VinSolutions in 2008, Mo was a respected Internet Director and eCommerce Director for two different automotive groups.