Three Ways Dealers Can Benefit from Blockchain Technology
Revenue opportunities are dealership opportunities
Here’s why: In many respects, the future of automotive retail is connected to blockchain because it’s a scalable, secure ledger system that can be used in virtually any type of transaction, no matter how small or what the data may be. In fact, auto retailers sit at the intersection where the use of blockchain may well open up possibilities for additional revenue streams, and lower operations costs. Here are three areas that come to mind:
1. Registration and title management
The streamlining of registration and title documents would be a big benefit in terms of time-savings, and cost. Instead of multiple online forms and software systems for in-state and out-of-state registration, a blockchain solution would connect all parties: buyer, seller, government, and third-party VIN and insurance databases. It would potentially make the process lightning fast and transparent to all. Just think: no more waiting 10 days for lender confirmation of title transfer. Thanks to this technology you can remarket that trade-in immediately.
2. Service and relationship management
Collecting data such as GPS, service, and driving tendencies is a benefit in the era of connected cars. When blockchain technology manages that data, the opportunities are wide open. For example, it could enable owner driving history and behavior, which would make service upsells easier and more powerful. It may also come in handy when the time comes to assign a trade-in value, market a lease pull-ahead offer, sell accessories, and more.
3. Ride sharing or subscription car ownership
Ride sharing and subscription payment programs may actually be the most valuable and realistic area of influence. A blockchain-based payment program could enable dealers to operate a subscription service of their own, or perhaps a ride sharing service in their local area. There are even emerging models of need-based insurance that would also use blockchain to facilitate usage.
It’s my opinion that blockchain technology does one core thing exceptionally well, which is why it’s so important to dealers. It connects buyers, sellers, products and regulatory agencies together in a transparent and secure way. That, as a result, can be used to expand business and streamline operations. And here’s the bottom line: with all the testing and experimental programs taking place, the chances of blockchain coming to your dealership is already pretty good – either from an automaker or vendor.