Online-offline Integration in Automotive Retail

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Some things never change. Even with online configurators, third-party platforms and huge amounts of online materials, most customers still want an offline component for automobile transactions. They want to see what vehicles look like in person. They want to test-drive them. And they still want additional information from dealers and sales staff.

Automotive retail report from industry leaders prove that things have transformed immensely in the past 10-20 years. Whereas customers would visit upwards of five different dealerships across several separate trips in the old days, they now usually visit just one dealership a single time during the buying process.

In many ways, these market shifts are a blessing in disguise for automotive retailers. Transactions require less time freeing up staff to focus on other customers and provide better service. Nonetheless, nailing a seamless online-offline integration is not something that should be taken. The pipeline as it exists today is still complicated and leaves plenty of gaps that even interested and ready buyers fall through.

Customer journey gaps

Customers now expect to move freely between online and offline ecosystems. As they design their ideal car in a digital configurator, they want to easily move into the offline world to test drive it.

Even if this all goes smoothly, there are plenty of ways for problems to arise. Let’s say an OEM displayed advertisements for a crossover vehicle that eventually led to a consumer configuring one and going for a test drive. In the process, the consumer decides that the crossover isn’t working for them and they’d prefer an SUV.

This information never reaches the OEM marketing department who continues to display crossover ads to a now frustrated customer. Worse yet, configurators themselves have issues that may cause confusion.

If the driver could not now configure an SUV based on her criteria, they’ll drop out long before they even reach the test drive stage, which is overwhelmingly the case. Less than 30% of consumers finish the configuration stage with only 1% of ever going on a test drive and 0.16% actually buying a vehicle.

Put simply, the current offline-online pipeline only works in a best-case scenario environment and does little to account the nearly infinite digressions and re-routings that take place even during smaller-stake transactions that one might experience purchasing a T-shirt on Amazon, let alone something as significant and expensive as an automobile.

Separate spaces must be connected

This is just one example of how the information pipeline breaks down throughout the consumer path to purchase. Engagement is another major problem. While nearly 90% of car buyers start with online research, more than half of them have no contact with dealerships before they walk in the door, leading to lower customer satisfaction rates.

The simple fact is dealers have historically treated online shopping as disconnected from their in-store activities. The result is not only missed opportunities but also requiring the consumer to complete more tasks at the dealership that could have been completed or started online.

Dealers shouldn’t bear all the blame for this. OEMs have likewise not done enough to foster early-stage communication between customers and dealers. Where are the chat boxes? Where are the resources center, FAQ pages, and AI assistant you can find everywhere else online? This absence of engagement tools alone and not bridging the gap quickly between consumers and dealers is a major failure on their parts.

Offline-online integration is vital for success

OEMs and dealerships must integrate their offline-offline channels to ensure smooth data flow. Misalignment causes dropouts, but integration boosts conversion. Further, information and configuration need to evolve beyond digitized brochure or confusing configuration into intuitive tools that do more than walk customers through the sales process and provide them all the resources they need along the way—including being able to talk to a real person! If they fail to do this, then customers will continue taking their business to competitors.

Mastering these challenges requires seamless integration and cross-promotion of channels while evaluating customer pain points and refining their service offerings in the process.

Improving offline interactions

While most car dealers do an excellent job of selling cars offline, customers are still dissatisfied with:

  • Large amounts of paperwork
  • Pushy salespeople who want quick decisions
  • Poor communication between sales and service
  • Length and unnecessary complexity of sales stage
  • Absence of proactive contact for customers about to change their vehicles

Dealers need to remember that the two most important stages still occur offline—the test drive and the purchase. But that doesn’t mean the customer journey of how they got to this point isn’t irrelevant to them, especially with so many people falling through the gaps.

While physical touchpoints remain essential, a successful customer journey is only possible by aligning online and offline elements.

Enhancing digital experiences

OEM portals have their own challenges that must be overcome. Many OEM websites don’t offer the option to purchase cars online, book dealer appointments, or even provide accurate GPS results for the nearest dealership. All of this is on top of clumsy configuration systems and architecture that makes it difficult for offline channels to get the consumer data they need.

With so many experiences beginning online, OEMs need to find ways to build customer experience and successfully lead them to proper sales channels.

Offline-online integration: The bottom line

Automotive retail is set for massive disruption over the next few years. With new entrants like Carvana as well as fundamentally different mobility sharing models gaining ground, automotive retail is ripe for transformation.

Both OEMs and dealers, along with other industry players need to walk away with these three conclusions.

First, customer behavior has changed. There is massive demand for offline-online integration and the ability to move seamlessly between these two channels. This needs to be at the top of everybody’s marketing plan.

Second, no OEM or dealer is there yet. While there have been impressive test projects like Volkswagen We or Ford Next, there is no champion off and online integrator. This means there is huge upside potential for those that develop solutions quickly.

Finally, mastery of integration will be an automotive retail value drive and game-changer. This will require immense coordination, information exchange, and a renewed focus on the customer.

The stakes are higher, but with such fierce entrants into the market, the old cliche innovation has never been more true than it is right now in automotive retail.

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