Tips, Tricks & Trends

Don’t Expect Car Dealerships to Completely Die Anytime Soon

In the age of COVID-19, a consensus is now built that things will never be the same as they were. Maybe this is an exaggeration, but places like car dealerships have taken a massive hit as a result of quarantine.

How have these businesses survived to keep themselves above water? It has not been an easy road, according to many recent reports. Turning to the online world is becoming one of the saving graces.

The challenge, though, is someone buying a car based strictly on online photos and descriptions. Buyers still want to see the car in person. With that in mind, one would think car dealerships are dying out. In truth, they will survive based on new customer preferences and technology.

How serious was quarantine on car dealerships?

According to Business Insider recently, a 53% plunge in new car sales took place when quarantine first began. However, car dealerships (like all businesses) made a quick scramble to keep themselves alive when everything shut down.

Many of them quickly turned to what they deemed “touchless protocols,” or allowing the car buying journey to transpire online. It worked, at least for some customers.

As noted in the above Business Insider piece, one customer wanted to visit a dealership to see a car in person. After going through the car buying funnel online, he managed to complete the entire buying process there.

Thanks to more interactive features, enhanced imagery, and financing opportunities through digital portals, buying a car online might become the new norm.

Dealerships may survive through online experiences

The New York Times recently gave a reminder about car dealerships: They long resisted the process of e-commerce. Being forced into it now, things are starting to evolve.

Some dealerships, like General Motors, devised a new e-commerce system. Theirs is called “Shop Click Drive”. Based on the above statistics, 85% of all GM car buyers used this app since quarantine began.

Many similar apps are also out there and starting to pick up steam. Most interesting is Tesla was doing this earlier than other car makers. Anyone buying a Tesla in the last few years could buy their car online, customize it there, plus get financing.

This apparently proves Elon Musk was ahead of the curve after all. Yet, what everyone wants to know is whether online car sales will become a recurring thing. Or, will people still come in to dealerships for a live buying experience?

Reinventing traditional car dealerships

Many of the same tactics car sales teams use can be used in an online environment. For instance, discount prices are usually mentioned, albeit only when the buyer starts entering personal information into the system.

One hurdle lately is dealerships having to show the actual price and not being able to mention the car will likely sell below initial price after negotiation. Now this process is becoming more refined so it feels like the salesperson is right there offering the discounts.

Chatting with sales staff is starting to become a part of the online fray, making it as easy as talking with them face to face. The same goes for the financing aspects, including signing documents digitally thanks to touchscreens.

Turning the car-buying experience into a similar process one would use shopping at Amazon is really a bit overdue anyway. It does alter sales tactics since those who sell cars practice for years to get their sales skills down pat. Now it all comes to how they present themselves over the phone, which is maybe not so different. All told, the traditional dealership may have just stepped up to the times, only due to the revenge of microbes.

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