DETROIT — Cox Automotive released the findings of its “Future of Digital Retail Study,” with results showing that the current dealership model needs to change with consumer preferences, but that the dealership remains central to car buying. While most consumers prefer completing at least one step of the car buying process online, analysts found, most car buyers want to complete the transaction at a dealership.
On the digital front, 71% of consumers want to get accurate, detailed information on the deal online and 83% of consumers want to complete at least one purchase activity online. Consumers indicate they want to complete a majority of the legwork before they enter the dealership. They want to agree on an accurate price that does not change later in the process, understand and select add-ons and warranties, agree on a trade-in value and other costs ahead of time, reducing — or eliminating — the time necessary to negotiate the final purchase price in-store.
Cox found the average buyer currently spends three hours at the dealership during a car purchase, with 90 minutes spent on negotiating the financial details. Consumer satisfaction with how long the process takes at the dealership continues to decrease, dropping from 55% in 2016 to 46% in 2018.
On a parallel track, the dealership is important for consumers in both initial research and final purchase processing. Nearly nine in 10 respondents want to complete their purchase at the dealership; only 11% of consumers want to review and sign paperwork online away from the dealership. However, Cox’s research shows a growing percentage of people are interested in completing the entire purchase online in the future.
Results of the study prove the dealership continues to have a significant role. Eight in 10 consumers would never purchase a car without a test drive and seven in 10 would never purchase a car without physically seeing it first, even if a condition report is offered — both activities typically conducted at a dealership. The survey also indicates that most car shoppers want dealership staff to be valuable consultants during the process, especially for learning about the individual products, features and vehicle capabilities.
“The results of our study show that the most successful dealers are the ones who offer a connected in-store and online experience, where consumers start car-buying activities online and seamlessly finish them at the dealership,” said Mike Burgiss, vice president of digital retailing at Cox Automotive. “Importantly, a more efficient process is not only better for consumers, it’s better for dealers as well.”
The importance of a connected dealership is displayed in the study where 85% of shoppers are more likely to buy from a particular dealership that allows them to start or complete nearly all of the vehicle purchase online. Considering the many retail options offered by other industries today, consumers are right to expect a flexible, seamless car-buying experience both online and in the dealership.
“2018 is when consumers will see significant change in the experience,” Burgiss added. “The technology and tools are here to make car buying more efficient for both consumers and dealers. With new solutions streamlining and improving the experience, we firmly disagree with anyone who says the dealership is dead — it’s not, but the old way of car-buying certainly is.”
To read the study in its entirety, please click here.
Originally posted on F&I and Showroom