buckle in: AUTOMOTIVE SALES IS CHANGING
Back in 2016, I remember the day like it was yesterday “where I first passed my driving test”. I was so nervous, and keen to pass the first time to gain a new sense of freedom of being able to do what I want when I want.
For the first few years, I was under the radar and categorised as that new-age driver where even when I wanted to drive a certain car, the consequence of paying higher insurance impacted my decision a lot. I was lucky though, as I enjoyed driving in the family (so-called hand me down car), which was a Y-reg polo with no power steering!
I was thrown in the deep end as a new driver. However, it was fantastic as t I had gained freedom, and the car got me from A to B.
My choices of the vehicle are often influenced by economic factors, particularly as a student, and the idea of keeping a car for a long time which is going to be reliable. In my experience, I have enjoyed models from VW, which have lasted forever! One a Y-reg, the other an 03 model.
However I have not driven many others, so I’d love to explore the new models which are exciting to see for many reasons other than just the EV hype. One of my fond memories of experiencing a car was with my family where we took a trip across the states. It was memorable as the car was iconically American and the trip was fuelled with ambience food and culture. Also, on a family holiday to Cuba, it was fantastic to experience the old-style classic American cars. However things change.
Since 2016, it seems as though things had changed, rapidly. These rapid changes are coming in ways and which, I didn’t even predict back when I was learning to drive. There seems to be an epic rise in electric vehicles and actually more market availability. The good news is that at least I can now imagine owning an electric car in the near future, thanks to the changes in consumer demands and the way in which brands are innovating to keep ahead of supplies.
But recently when researching insights I learnt about how the future of automotive sales is and explored the direction of consumer changes over the next 3-5 years. With that said, I thought it would be helpful to share my insights to explore ‘The Transformation of Buying a Car’.
This will be something that will not only affect the dealerships and salespeople but also each and every one of us who wish to purchase a vehicle in the future!
With the ever-changing wants and needs of the conscious consumer, it is vital that dealerships are ahead of the curve, and work towards knowing what these are, and adapting their sales strategy accordingly. Doing this, will enable them to acquire new customers, and focus on new areas to close sales. Research by IBM showed that only 19% of automotive executives describe their organizations as prepared for the challenges, and therefore much learning and market change preparation is necessary. This blog will discuss the key features of the automotive industry which are expected to change over the next five years.
The future of sales is changing…
Research from Mckinsey, IBM, and Deloitte is showing this. Sales growth worldwide is declining, and there are many different sellers, with different business models gaining momentum. Car selling is currently based around customers entering the car dealership, with the idea of which brand of car they wish to purchase (hence entering that dealership), and then buying a vehicle based on the salesperson’s advice, and also the haggling of prices which takes place.
This approach, however, is now changing!
The conscious consumer is becoming more interested in the environment, and therefore the status symbol of a ‘fancy car’ is being removed. There must be transformations in sales structures for the sales to continue.
The consumer is also now demanding dealerships to change the car purchasing process. This must become a more customer focussed, omnichannel buying experience, where the consumer has the choice of many vehicles in one showroom so they can select their chosen vehicle based on the features they want and the buyer’s personality, rather than the brand. This, therefore, means there is a great need for companies to understand the consumer, and be able to obtain a 360-degree view to ensure there is the correct experience created for each consumer. This will therefore improve the closure of sales due to the human-centric approach which will take place.
In my opinion, I see this change being beneficial due to, as a consumer, less background knowledge will be necessary. The experience will be able to have all the options in front of me, and therefore the ability to choose the actual best car for my needs, and not the best VW, or BMW or Audi (for example) for me. It will enable me to save time, a bit like going into a carphone warehouse store for a new phone: the background research has been done, but there are plenty of other options there to see and decide if they are more appropriate.
“Car-purchasing process that is personalized and fun”
Following on from that, the dealerships must become more like shop floors selling normal goods. This means the removal of haggling, and changing prices. The price is set by the manufacturer. This, therefore, removes the traditional ‘sales’ aspect of the dealership and improves the necessity to understand the consumer to make sure the salesperson aims the sale in the correct direction to create sales closures.
Personally, as a consumer, this would make my future decision making be more about the features of a vehicle, rather than the brand. Currently, as having minimal model and driving experience, my ideas surrounding what i would like in a car are small. Therefore, this would allow for easier, and less manufacturer-biased vehicle buying.
To conclude, it is vital that with the changing automotive industry that to execute pipeline closure and revenue generation within the dealerships, that the salesperson explores and evaluates the needs and wants of the consumer in question. This will therefore enable sales excellence within turbulent times, and allow the dealership to keep up to date with the new normal of set prices, combined company dealerships, and a more personalised experience.
I would love to hear your experiences, where is the best place you’ve driven, what do you remember from your driving test, and finally, what are your thoughts on the changing world of the automotive industry?