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Jared Hamilton
From: Jared Hamilton
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Amit Maheshwari

Amit Maheshwari Vice President, Corporate Strategy and Development

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Digital Marketing vs. Digital Retailing

Digital Marketing is hot! Dealers are spending more than ever on SEO, SEM, Digital Media purchases, Inventory on-line merchandizing purchases etc. For good reason: many well respected sources tell us that 90%+ of the car shopping process now starts online.

So, this spend/focus has managed to get the consumer to the dealer’s inventory listings and even a specific vehicle. Now what? Most VDPs (Vehicle Detail Pages) are complicated and confusing to a

normal (non-auto savvy) consumer. On one dealer’s page, I counted 14 “call to action” buttons. In the meantime, the consumer just wants to buy a car (can there be one iPad like button please?). Often, the most prevalent call to action in these VDPS is to “email the dealer”. Why not drive this consumer, further down the sales funnel before they come to the dealership? Why not convert these shoppers to buyers online?

The way that the next generations of consumers want to socialize, shop and in general, spend their time has fundamentally changed. Gen Y and Z is consuming online data usage at an alarming rate. For example, there are some estimates that data usage increased for 18-24 year olds from 216MB a month in Q3, 2010 to 534MB in Q3, 2011. Another study in the UK found that teenagers spend 30+ hours a week online. This generation will grow up with “bytes” as their trusted friends and the concept of spending  hours at a dealership to buy a car that they probably know more about (through online research) will be alien. No wonder, Cap Gemini’s latest Car Online 11/12 survey finds that 42% of worldwide consumers are likely to purchase a car online. This number was 37% in 2010 and single digits in the early 2000s. This is where Digital Retailing comes in.

Most dealers spend time and money to ensure that the in-showroom sales workflow experience is consistent and sensible for the consumer that walks into their doors. So why does it often fall apart on their web-sites? This is an opportunity missed to drive the consumer deeper into the sales funnel before they even lay foot into the showroom. Think about printing out a boarding pass online and coming to the gate directly. This improvement in workflow has nothing to do with pricing or disintermediation. This is about consistency, efficiency and control. This is about delivering the relevant buying experience to a different consumer.  

By the way, Digital Retailing is good for business. Data consistently proves that conversion rates on leads are higher when the consumer has performed various activities towards the purchase online. I will provide more data on this in a subsequent blog post. Enabling web-sites with dealer-controlled, integrated sales workflows is the next logical step in today’s digital metamorphosis. Certainly, some retailers have adopted this concept already, but I believe that the time for mass adoption is around the corner.

Dealers cannot do this alone. Leading vendors will also need to build technology that deeply integrates in-store transactional systems and data to web-site capabilities. Sending an email lead in the ADF-CRM format was a good start. That was more than a decade ago. Technology in this area needs to evolve - soon.

Chris Costner
Very interesting perspective and I will agree. I recently had a conversation with my mentor regarding what digital marketers can do better for their clients. As I began to think and discuss more during the conversation, it is about servicing our clients and goes right along with your idea of taking the customer further into the funnel. We as dealers have our own objectives for "benefit / ROI" on our digital efforts but what "benefit / ROI" is our current and future clients receiving on their end?
Lee Novak
Years ago, the the informed and technical minded buyer used the internet simply for information gathering. Today the buyer is accustomed to using the digital aspect as an important tool THROUGHOUT the process from information gathering to actual purchase of the vehicle. Dealerships that are not focused on this important tool are missing out on an important segment of customers. Ultimately they will lose out the potential sales to this segment of customers to - the competitor who IS taking advantage of this valuable tool. And it is not just sales of vehicles. What is the loss of repeat business? Or service department sales? Digital retailing is a must. Today is the future.

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