How Online Technology is Changing the Car Buying Experience
Changes in the auto industry since its beginnings in the late 1800s have, mostly, come from innovations with the cars themselves, yet today the biggest changes have to do with the buying experience. This isn’t to say innovation with vehicles has slowed down, rather the way consumers’ shop and purchase them is changing more rapidly. Let’s discuss this more by examining how online technology is changing the car buying experience.
Not only are consumers shopping online more and more for vehicles, but they’re also purchasing them online and having them delivered to their doorsteps. Not too long ago this idea would have been hard to imagine, yet today it’s a reality with startup companies like Vroom, CarMax, and Carvana.
An article found on Bloomberg called: “Online Car-Buying Startups Emerge as Dealer Aids, Not Disrupters”, written on March 20, 2017 by Gabrielle Coppola, explains:
“To be sure, there are startups in the U.S. that have already put the entire car buying process online – including those final steps dealers are gripping tight. But they’re confined to the used-car market due to franchise laws and manufacturers’ reliance on dealer networks.”
Remotely purchasing a vehicle completely online, without physically testing it out, is something only a certain segment of consumers are willing to do, yet it does show how technology is changing the car buying experience. The article explains the scope of this new phenomenon:
“Vroom is a three-year-old startup that buys, refurbishes and delivers used cars to shoppers’ doorsteps without making them visit a dealership. The company sold 50,000 units last year and had $1.1 billion in revenue…”
Being able to shop, get pre-approved, facilitate the financing process, and then have the car delivered, is giving consumers a convenient, hassle-free option when purchasing used cars. This may be the extreme example of the buyer’s experience, yet the online factor is a common theme in the modern car buying experience, even when consumers finalize the deal in-person at dealerships.
Streamlined Car Buying Experience
Auto dealerships aren’t in danger of becoming irrelevant, yet they’re being asked to streamline the car buying experience to facilitate online shopping and financing processes. Basically, the buying experience is, and will increasingly be, one where the consumer shops, gets pre-approved, and then comes to the dealership to finalize the deal.
The article explains:
“Dealers themselves are embracing technological change because they realize they have no choice but to accept the dominance of e-commerce…”
Streamlining the buying experience for dealerships means:
- optimizing websites, including mobile functionality
- adopting SaaS solutions for pre-approval and real-time inventory updates
- facilitating F&I and ID verification processes at dealerships with automated data integration
- giving sales teams remote accessibility to enterprise systems.
Basically, traditional models of filling out paperwork and waiting for hours to facilitate these processes at dealerships are becoming cumbersome and counter-productive. Optimizing the buying experience means giving consumers the ability to shop for vehicles and facilitate these processes online as much as possible, then developing a time-efficient and hassle-free process to close the deal when they arrive.
While there will always be the auto consumer who wants to shop and facilitate the entire car buying experience in-person at the dealership, there’s definitely a growing shift towards the buying experience being conducted online – at least partially. Therefor, online shopping and remote purchasing are the main ways online technology is changing the car buying experience today.
Auto dealerships can capitalize on future online buying trends by offering consumers as much online functionality as possible during their buying experience. Adopting vertically designed SaaS online technology, like eLEND Solutions’ products, will help position dealerships for future growth by optimizing their customers’ buying experience. If interested in learning more please contact us today.
Author: Pete Maclnnis
Author Bio: Pete brings over 37 years of experience in automotive finance and technology as Founder and CEO of eLEND Solutions™. Founded in 2003 as DealerCentric, eLEND Solutions™ is an automotive FinTech company specializing in online and in-store digital credit, identity and finance solutions designed to create a more efficient and profitable vehicle purchase process for the retail automotive industry.