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From: Jared Hamilton
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David Metter

David Metter President

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Is the Internet An Enemy To Car Dealerships?

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A 2014 study by Autotrader showed that consumers are visiting fewer dealers in their car shopping than ever before. This is certainly a by-product of the availability of information. No longer do consumers have to visit multiple dealerships to find the right vehicle. They simply sit in front of their computers and browse a dealer’s inventory on their website or, more commonly, a car buying portal site. In fact, the same Autotrader study showed that 79 percent of consumers are using the Internet in their car-buying process.

 

When the consumer has completed their research, decided upon a vehicle and visited a dealership to view and/or test drive it, many don’t actually end up buying the vehicle they came in to look at. They end up finding something more suitable to their lifestyle, or one that is a better fit for their budget.

 

They arrive at the dealership, armed with all their Internet research -- ready to do battle should they experience anything less than a frictionless experience. However, many find themselves in a situation whereby they are perhaps not quite as ready for battle. Perhaps they now feel they will be at a disadvantage at the negotiating table.

 

So what does THIS consumer do now?

 

They whip out the one thing most consumers never leave home without -- their smartphone, right in the dealership’s showroom, and start shopping the competition. A 2014 survey by J.D. Power and Associates revealed that 34 percent of new-car buyers who research online use a smartphone or tablet while shopping at a dealership, up from 29 percent in 2013. Vehicle pricing is the most frequently accessed content while at a dealership (61 percent), followed by model information (42 percent), searching inventory (40 percent) and special offers/incentives (36 percent).

 

If consumers are so armed to the teeth with information, why do 61 percent access information on vehicle pricing while at a dealership? Most likely because they changed their minds while viewing the vehicle and landed on a car other than the one they came to look at. This use of smartphones by dealership customers to research the inventory of other competing dealerships may well lead to an increase in dealership visits.

 

You can’t buy a car from the Internet – not yet, at least – so it might be wise to consider that the buyer that walks through their door with the MOST information is the one that you should ensure gets the BEST customer experience. As they, according to the J.D. Power study, are the ones likely to visit more dealers.

 

When consumers are shopping for a vehicle, they may think they know what car they want to buy. However, studies show that they can easily change their minds while at your dealership. And, if they are shopping your competitor’s inventory right from your lot, they may also change their minds about if they want to buy a car from YOU.  Give your customers a good reason to buy from you versus any competition, and perhaps you’ll find less resistance, happier customers and more sales.

 

In the end, the Internet is not a dealership’s enemy.  It provides us all with much needed information and services that can be much harder to find elsewhere. Consumers will use it whether you want them to or not. Embrace technology and find a way to use it to your advantage. If you still don’t agree, just remember the old saying:

 

Keep your friends close and your enemies closer.

Chris K Leslie
"Most likely because they changed their minds while viewing the vehicle and landed on a car other than the one they came to look at. This use of smartphones by dealership customers to research the inventory of other competing dealerships may well lead to an increase in dealership visits." This is absolute speculation. What if they're playing angry birds, checking facebook or thumbing around tinder. What if they're just wanting to make sure the price they are being presented is the same as the website or cars.com or autotrader. I don't think introducing scare tactics should moral of this story.

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