Dealerships accelerate digital activity as restrictions begin to ease

The Covid-19 pandemic has had an impact on almost every part of our lives, from the way we live, to where we work, how we shop and how much we travel.

As restrictions ease, consumer behaviour continues to be driven by changes in personal circumstances, such as income and employment, as well as new habits that have been formed during lockdown.

Many people’s buying behaviour has evolved and are no longer the same as they were pre-pandemic. The combination of shops not being open and concerns about leaving the house has accelerated consumer acceptance of ecommerce models. Many people have become used to buying almost everything online and businesses have had to adapt to offer online services in order to survive.

Online retail has increased by 41% in the past year and more consumers are deciding to use online channels for significant purchases, such as vehicles. The automotive sector, which has traditionally lagged behind high street retail when it comes to online sales, has had to accelerate the use of digital processes, such as finance applications, in order to be able to operate during the pandemic.

The VWFS Drive website has also taken off during lockdown. Being able to give drivers access to a wide range of brands online, taking them through the finance process both online and over the phone to then be picked up at their local dealership has allowed VWFS Drive to give many the confidence to buy a new car from the comfort of their homes.

Yet is this just a temporary shift because consumers have not been able to go into showrooms?

Research suggests that new buying habits are here to stay, and with some consumers still looking to minimise time out of the home, online sales are expected to continue to be a rapidly growing part of both the new and used car markets over the next five years.

A study by Frost and Sullivan estimates that almost 825,000 new vehicles were sold through online platforms globally in 2019. By 2025, it’s estimated that this could increase to around 6 million vehicles.

Yet the move towards online does not mean the end of the automotive retailer, rather it offers them a significant opportunity to reach a wider market, boost revenues and protect themselves against future lockdowns.

Retailers still have an important role to play in personalising the online sales process; even those that allow customers to fully complete sales online include personal touches such as video tours of cars, opportunities for test drives and aftersales service.

Offering a blend of both clicks and bricks enables dealerships to serve the needs of all customers, no matter how, where or when they choose to buy a vehicle. Customers may choose to come into the showroom to view a car, get advice and have a test drive, but then decide to complete the finance and sale later online.

Some consumers want the whole showroom experience, whereas others will want to carry out the whole process online and get the car delivered to their house without stepping foot on a forecourt. A blended approach to car sales needs to recognise all these needs.

Currently, if a car buyer was to search their local vehicle retailers online, the digital sales offerings would be very different. Some are very sophisticated, with the ability to complete the whole sale online – from reserving a car, applying for finance, arranging a part exchange, right through to collection or home delivery options.

Others simply act as a search tool, enabling customers to browse available stock but with no ecommerce functionality. Whilst, in the past, this would not have been an issue, with greater numbers of consumers looking to buy online, not offering that service could be detrimental.

Even a couple of years ago, full lockdowns of car showrooms would have been unthinkable, now the chances of it happening again must be prepared for as part of any good business planning. Launching an online sales offering will help to futureproof businesses against any further enforced closures and help them capitalise on changing consumer behaviour.

With industry experts predicting pent-up demand for car buying, dealerships that can get ahead of the curve by offering a strong ecommerce platform, which complements their face-to-face showroom offer, will be best placed to take advantage of post-lockdown sales opportunities, and become truly responsive to the clicks-and-bricks world we now live in.