Digital Retailing – What Will Happen in a Post COVID-19 Dealership?
Even though NADA took place just a few short months ago, I think we can all agree that the Coronavirus pandemic makes it feel more like a decade ago. Writing this at the close of March 2020, I’m in the dark about what might happen next in terms of “stay-at-home” orders, dealership closures, and auto manufacturing plants being taken over with government orders to build ventilators and other urgent supplies required by our heroic healthcare workers, but there’s one thing I do know: this pandemic will change a lot. And I’m not talking about the economy and potential job losses – yes, there will be a lot of pain in the short term, but I believe in an America that will fight this off and get back to work sooner rather than later to rebuild.
What I do think will drastically change is the speed by which both consumers and dealers will begin adopting/utilizing the digital retailing (DR) tools that are available to them. And, to be honest, those dealers who have already taken the leap from old-school lead generation to a more integrated digital approach already have an advantage. Those who have truly embraced DR – moving steps in the buying process from in-store to online – are no doubt already leading the pack. For example, in the embattled state of New York, Gov. Andrew Cuomo is allowing dealers to sell vehicles remotely – clearly those that can, will.
Why do I believe that now is when digital retailing will come into its own? Let’s talk about a post-COVID-19 consumer first. So much has changed in such a short time period of time. Consumers who hadn’t already embraced social media, online shopping or digital communications are now relying on their computer screens to deliver just about anything they want – including personalized workouts, social gatherings (have you tried a Zoom happy hour yet?), and, of course, online shopping/ordering for anything and everything.
This pandemic has turned us into a nation of digital-first shoppers and now that nearly every car-buying demographic has found a certain solace and connection in their screen time, it’s not likely to stop any time soon. This trying time in our history means that consumers are getting used to doing things differently – whether by choice or by force, they are becoming digital natives, and this is something that auto retailers won’t be able to ignore any longer. Also, they’re getting used to idea of “social distancing” and are well aware that this may be our “new normal” for the next 6-12 months. Perhaps not in every city and state, but in densely populated areas and for at-risk individuals.
What does this mean for a post COVID-19 Dealership? Now is the time to look at how the digital experience you offer works for your online shoppers and begin exploring opportunities that insure a more seamless transition to your desired in-store experience. In our recent report on Digital Retailing, based on dealership surveys, 92% of dealers said DR has a positive impact on sales and profitability (68%). However, they reported that the biggest challenges to successful DR were around training, leadership and process integration.
We reported that the majority of dealers (83%) agreed that “digital retailing combines technology and process/workflows to help customers move themselves down funnel online and seamlessly pick up where they left off when they get to your dealership.” That being said, dealerships emphasized that not having the right in-store process, communication strategies and integrations were significant obstacles to DR fulfillment.
One of the things we’ve observed as we’ve rolled out our digital financing tools to our dealer customers is that it can be very difficult to wean them off their lead-gen addiction. Dealerships need to get their entire team on board – including the F&I department so that financing can also start online – making the necessary culture changes and putting training in place for personnel to get the most out of DR.
This forced lull in “business as usual” provides a unique opportunity to re-think the DR opportunity and to further train and engage your entire team so that you come back strong in a post COVID-19 dealership!
Pete brings over 40+ years of experience in automotive finance and technology as Founder and CEO of eLEND Solutions™. Founded in 2003 as DealerCentric®, Pete is leading the company’s evolution to an automotive FinTech platform focused on deal generation solutions that power transactional digital buying experiences for the retail automotive industry.
The platform specializes in hybrid digital credit, identity, and finance solutions - designed to accelerate conversions of digital end-to-end purchase experiences - concluding with a transactional, fundable deal structure.