The technology behind selling vehicles is changing from a dysfunctional array of tools to a smooth and connected journey that fuses the power of online efficiency with in-store, in-person, and at-hand relationship building.

Today’s typical car shopper spends most of their time online. It’s a fact, and one most of us have known – at least intuitively – for a while. Indeed, Cox Automotive’s 2017 Car Buyer Journey Study cinches it: Of the 14 hours or so most people spend shopping for a car, 60 percent of that time is online – not on the car lot. They do all that work, invest all that time, and when they’re done they visit one dealership. That’s it. And they most often test drive just one car. All that points to one thing: customers increasingly have their minds made up before they walk into the showroom.

In other words, customers go slow – to go fast. They spend many hours online so that the sales and finance experience is designed to their needs and requirements. It’s part of an ongoing and unmistakable change in the behaviors that drive automotive retail. Today’s optimized dealership must be able to provide the kind of experience shoppers demand – an experience based on connectivity, mobility and efficiency.  

Connectivity of Sales

The technology behind selling vehicles is changing, from a dysfunctional array of tools into a smooth and connected journey that fuses the power of online efficiency with in-store, in-person, and at-hand relationship building. In real terms, what that means is this: The work a customer does online must connect into the showroom, reducing frustration and creating efficiencies throughout the sales and business process. Behind the scenes, that opportunity to connect retail and operational workflows – to create a simplified and data-driven user experience – has the potential to streamline productivity and find areas of profitability at a time when sales may well plateau. Connectivity is simply what keeps the conversation going, and reduces the chance that your important guest is forced to re-tell their story over and over again. Think of it in terms of the test drive: after all those hours spent online, people still must touch the metal and drive the car to believe in the dream of ownership. That’s a real connection. When it goes wrong, customers often leave: The Buyer’s Journey reported that 1-in-5 new car buyers did not purchase from their initial dealership visit because of a poor sales experience – something that could be caused, in part, by a break in the connection between dealership and customer.

Mobility of the Online World

A substantive and connected sales conversation can and should be had anywhere in the showroom by using mobile to connect online and physical environments. The Buyer’s Journey found that 53 percent of shoppers use multiple devices when shopping for a car, and that 18 percent used mobile devices exclusively. Given that, why do we think people stop using their smartphone when they arrive at a dealership? Or that they are somehow more comfortable with a paper and Styrofoam cup experience? With so many connection points, dealerships who use mobile to create a comfortable and transparent environment are building a bond of trust between customer and sales specialist. Once that bond is created, that trust continues into all aspects of the sale – including F&I products.

The Speed of Efficiency

Effective technology offers a simple answer to fundamental and head-scratching business challenges. All in, it comes down to finding more efficient ways to operate by helping to make the act of completing a task easier, faster and more accurate. Showroom and operational solutions can and do reduce errors, speed process and eliminate unnecessary costs; one only need look at the benefits that electronic contracting (to name just one) has brought to today’s dealerships.  

The difference today is that efficiencies brought by dealership technology are not “nice to haves” but required to keep customers happy and coming back. Indeed, most car buyers like the test drive experience – 79 percent gave it a high rating. But when the F&I process is factored in, that satisfaction score drops to 64 percent, per the Buyers Journey.  As simple as it sounds, that unhappy decline in satisfaction is caused by…paperwork.

Paperwork?

That’s right. Sixty-five percent of new and used car buyers felt that the paperwork process took too long to complete, and, when faced with hours of it, their happiness cratered and their satisfaction soured. Dealership personnel can solve that by simply leveraging technology, and other best practices, to reduce the time it takes to get through the process. That not only makes for a happy buyer, but also a happy business. 

When it comes to car sales and financing, the relentless search for efficiency touches all areas of a dealership. Smart dealer operators are finding steps and tasks that can be connected, automated and perfected; they’re reviewing workflow and expecting time and cost savings. For example, ask yourself this question: When a customer brings a car to trade with a balance due, how many days do you have to wait before you can remarket that vehicle? How long will that car sit on your lot, taking up valuable space, just because the “paperwork” takes forever? In today’s market, if a trade-in sits for weeks due to the time it takes for payoff and title processing…it’s an unacceptable obstacle to sales. Turning that workflow into a fast, consistent and trackable operation is what Accelerated Title does. If you’re considering Accelerated Title, ask these three questions:

1. What are the practical benefits to vehicle payoff and title release technology? Dealer operations benefit due to increased efficiency through a fast and automated process. Add reporting and tracking capabilities, and the technology reduces the time spent on administrative follow up. In terms of actual sales operations, it’s simple: a trade-in vehicle can be remarketed faster, and with less hassle. That’s great for the bottom line.

2. How does Accelerated Title speed the process of title release and payout? By streamlining the connection between dealer and lender. For example, dealers obtain payoff quotes directly from lenders through Dealertrack, allowing for precise payoffs. Accelerated Title then utilizes ACH processing to transfer funds, expediting the timeline for the lender to receive funds and trigger title release. Central to this is the integrated use of Dealertrack Title Management data; this allows for the speed of title delivery and creates a one-of-a-kind technology solution. Through automation, poorly-defined processes are also corrected, and made consistent.

3. What type of reporting and tracking does the solution support? This is a critical question, because when it comes to workflow knowledge is power – and data is king. As such, dealership personnel should be able to track status, get on-demand reporting, and have 24/7 access to statements or transactions. It’s a significant efficiency gain your team.

One hundred years in the making, this year’s “NADA 100” convention served as a perfectly-timed and appropriate gateway to the connected and digital future of auto retailing.

On the floor and throughout the keynotes, there was a feeling of measured optimism. At the opening press briefing, Steven Szakaly, chief economist of the National Automobile Dealers Association (NADA), reported a baseline forecast of 17.1 million units, “a slight decline of about 350,000 units, but still a very, very strong year.” Talk throughout the show was about adjusting to the chance of increased automaker incentives, and the impact those incentives may have on the used vehicle market – especially prime off-lease shoppers. According to Cox Automotive Insights, used sales increased 3 percent in 2016, with sales “projected to remain very strong in 2017 as wholesale supplies are expected to rise due to an influx in off-lease volumes entering the market.”

In other words – another year in the life of the automotive business. Come to think of it, that’s what this amazing show has always been about: possibilities. Over the weekend, that played out countless times at demo booths and partner meetings, where the discussion seemed to be less about a slowdown in sales and more about the possibilities of gearing up and getting ready for the next phase of changes.

Possibilities. There’s that word again. We saw it all weekend at the Dealertrack booth, whether the solution helped a sales team, improve business office efficiencies, or streamline F&I product sales. Questions ran the gamut from eliminating data errors to optimizing the time spent with customers, all with the same basic goal: evolve sales operations toward a connected reality that over-delivers on customer expectations and streamlines process into a tight, productive workflow. It was an optimistic show with all eyes on change that revolved around three key topics:

1. Mobility

According to Cox Automotive’s recently released 2017 Car Buyer Journey report, 53 percent of shoppers use multiple devices while shopping for a car, and 18 percent used only mobile devices. That’s up from last year’s 46 percent and 14 percent, respectively, and clearly shows the changing preferences of in-market shoppers. The lesson for dealerships: The days of bland, fern-laden cubicles are disappearing, and fast. Today, customers want the mobile experience to continue inside the showroom.

2. Connectivity

Streamlining key connections throughout the entire purchase journey is all-important, including (and especially) during the showroom experience. For example, the Car Buyer Journey study found that the average car buyer spends 60 percent of their total purchase process online – and that only 32 percent of consumers know the exact vehicle they want when starting to shop. When they get to the dealership, 55 percent only test drive the vehicle they purchase. That reveals the importance of connectivity, and how critical it is that the online to in-store experience is fused throughout showroom operations.

3. Efficiency

All in, technology comes down to finding more efficient ways to operate. Effective technology offers sustainable answers to fundamental retail challenges; it exposes areas of improvement that create competitive advantages. Based on findings from Cox Automotive Insights, one such opportunity lies in the negotiation and paperwork part of the deal. The report found that consumers spend over 90 minutes negotiating and signing paperwork. Their feedback? Reduce the time by 38 minutes. As such, managers visiting the Dealertrack booth were interested in making those all-important improvements, and spent time demo-ing solutions like eContracting and Accelerated Title.

--Brian Chee

Few technology solutions solve a pressing retail issue as efficiently and precisely as electronic contracting. Indeed, virtually every aspect of the contract process is improved through this technology, starting with an improved consumer experience, and ending with a streamlined workflow between dealership and lender. eContracting is a simple and elegant answer to the errors and delays that previously slowed the final step in the car buyer’s journey. Today, it’s emerging as a required solution that keeps dealerships competitive and customers satisfied.

If you’re researching electronic contracting solutions, start with these three basic questions:  

1. What do I need to know before implementing the technology? First of all, make sure your electronic contracting solution is based on a SaaS platform – otherwise known as Software as a Service. That will eliminate many of costs and hassles of the technology. It’s also important to consider data integration: common customer data points may prefill the eContract, reducing manual data entry. That saves more time and eliminates errors. Finally, think about important sales flow options, such as the ability to review and sign via mobile device. That can help to create a more comfortable and convenient consumer experience.

2. Will eContracting save my dealership money? It depends on your dealership and the number of your contracts in transit. In fact, that is a great question to ask your service provider, who should be able to provide your dealership with a customized savings assessment. In terms of efficiency, eContracting will reduce time spent processing contracts and obtaining funding. That improves the overall experience, cuts interest expenses, and improves cash flow.

3. How many of my lenders are available? It’s simple: more lenders equals more opportunity to use the technology. That’s why Dealertrack features more than 20 key lenders (banks, credit unions, and captives) across the US, including Ally, Bank of America, Chase, Capital One and more. 

-- Brian Chee

On paper, it sounds amazing: Place a handful of beacons – those tiny gadgets that talk to your smartphone – around a car at a dealership, and create a connection point between the shopper who’s wandering the lot, and content about the car they’re looking over. In a flash, that person is treated to key model features, aftermarket options…not to mention financing and special incentives. The opportunity to actually connect a car to the systems dealers use to market, retail and process a vehicle purchase may well open a new chapter in the online to in-store evolution of automotive retail. It’s beyond RFID codes, and printed brochures. It’s an idea that could re-imagine that initial moment of engagement at the showroom, and help dealers create a more efficient, rich and connected sales experience.

The Internet of Things

But wait – not so fast. Beacons, sensors, gadgets…whatever the name, they’re a part of the Internet of Things, otherwise known as the IoT. According to Webopedia, the IoT “refers to the ever-growing network of physical objects that feature an IP address for Internet connectivity, and the communication that occurs between these objects and other Internet-enabled devices and systems.” A more specific explanation might go something like this: take a car, embed it with a sensor, and enable it to exchange and share information across a network. As a result, you connect the physical and virtual world via a controlled and designed environment. The things that make it happen are very small connectors that use Bluetooth low-energy (BLE) technology to identify the location of a customer and deliver content to them. It works through the use of an app: the signal pings the phone, which pushes the appropriate content based on the location of the person. That creates a more content-rich and private environment, which results in a better consumer experience. The downside, however, is that the customer has to download the app and opt-into the experience.   

Retail Trends

That doesn’t seem to deter major retailers from employing beacons and sensors to more deeply engage with customers. Indeed, according to eMarketer, the use of “proximity marketing” is growing – and fast. The number of beacons deployed by proximity providers has grown from 3.3 million last year to over 8 million in 2016. In a survey conducted by Unacast, “50 percent of organizations connected to the retail, shopping mall, hotel and tourism industries use some form of proximity technology in their marketing efforts.”  Far and away, the most popular device to implement is beacon technology, followed by GPS. Still, though – there are hurdles for all retailers, including automotive. For example, a recent benchmark report by Retail Systems Research found “only 25 percent of respondents had wifi available for employees on the selling floor, and another 19 percent had wireless available for customers.” The study also cast a cautious eye on the issue of consumer privacy in terms of rules, guidelines and opt-in rates.   

The Automotive Internet of Things

Despite the challenges, the automotive industry is applying this technology in literally hundreds of ways, across virtually all aspects of the business. From factory productivity to showrooms, aftermarket and in-car infotainment, sensors that connect vehicles to data and networks are driving a new world order of connected cars and technologies. Gartner, in fact, sees that world growing to 250 million vehicles on the road worldwide by 2020, which adds up to around one-in-five cars. Possible applications run the gamut from enabling urgent medical assistance to advertising, vehicle diagnostics and much, much more.  In its 2016 The Internet of Automotive Things report, eMarketer researchers found that “IoT will give industry marketers more ways to communicate with target audiences, more data to target personalized messaging, valuable feedback about what they are doing right, and more ways to enhance customer service.” On the showroom floor, the technology is steadily gaining more attention. Last year, Ford tested beacons on dealer lots as a way to introduce key features about a specific car. The idea? Create a seamless bridge from research being done online to the showroom experience – a continuation of the online to in-store evolution of car buying.

Connecting the Experience to the Workflow

It all sounds exciting and promising – but then most new technological advances do at first, right? Sometimes, so called “transformative ideas” end up not being as amazing as initially thought. So it will be interesting to see how this connected reality unfolds at the showroom in terms of actual process, dealer adoption, and engagement. It may be that the use of beacons creates an opportunity for dealers to more closely connect sales workflow to car and customer. It may create a richer, more tightly aligned experience in which the dealer maintains control and is able to provide a flexible and nimble sales experience. Those little beacons might one day make it possible for a vehicle on a test drive to be instantly connected to fundamental aspects of the dealer workflow, easing the path to purchase – and creating a significantly more efficient and customer-focused experience.

There’s no doubt that beacons are connecting the physical world of things to the virtual world of content experiences. The only question is how they will be most effectively used at a dealership fitted with integrated retail systems. After all, one of the most compelling possibilities behind the Internet of Things is that it may create a complete retail journey from start to finish -- no matter where you start, engage, or finish the deal.  

The future? It's about leveraging technology to create connected experiences that customers will appreciate and demand, time and time again. As dealers continue on their path toward a true online to in-store relationship with car buyers, making that connection through customer-centric and dealership-controlled technology is a key step toward building trust and maintaining control.

It’s something that we’ve taken to heart. Strengthening connectivity powers our desire to create workflow solutions that are relentlessly efficient, transparent and profitable. From the showroom floor to the business office, each aspect of the dealership operation factors into how we approach innovation. To that end, we’re mindful that the business of automotive retail is and will always be all about relationships. As digital tools become prevalent in the space, that doesn’t change. In fact, the need to create a stronger, personal bond with customers is more important than ever – and it’s exactly what thoughtful digital tools do. Already, the technology exists to help to support that type of sales initiative – and as the years roll on, more is sure to follow. Innovation never sleeps, after all – and dealerships should be prepared to understand how they can put technology to work, selling more cars and creating satisfied customers. To that end, here are three future innovations that may one day wind up at your local showroom: one that’s arriving, one that’s on its way, and one that has the potential to make a significant impact to the future of car sales.

Here Now: Structuring the Deal Online

According to Autotrader’s Car Buyer of the Future Study, “consumers want to structure deals online before arriving at the dealership. Fifty-six percent like to start the negotiation on their terms, and 45% like being anonymous to the dealer until they lock in a deal.” The study looked at the current shopping, buying and ownership process, and asked more than 4,002 consumers about their ideal process. Part of its findings showed that when it comes to buying a car, it seems to be less about ecommerce and more about  “connection commerce,” through digital retailing tools like MakeMyDeal. These tools enable online discussion on the vehicle details page (VDP). Connection Commerce gives consumers the platform to create the type of experience they want, in a trusted and authentic environment. As a result, they share legitimate intentions that a salesperson can use to craft a fair deal for all.

Probably Here in a Few Years: Augmented Test Drives

If you’re wondering what Augmented Reality (AR) is, just think about Pikachu – and how the game Pokémon Gohas taken the world by storm. By literally "augmenting" reality with an enhanced and optimized digital experience, the game takes on an entirely different level of entertainment. Just imagine what dealers and automakers could do with AR in the showroom. As a matter of fact, quite a few automakers are already engaged in testing the technology, including Fiat Chrysler Automobiles (FCA), Ford, and others. The work that FCA has done via Accenture Digital – and through Accenture, Google’s Tango developer kit – is moving quickly toward enabling AR interaction with a full-scale version of a car through a mobile device. In addition, Cadillac is exploring way to incorporate virtual reality into its U.S. dealerships; as cars are serviced, for example, consumer can plug in and check out the latest and greatest features. Technology like this expands the role of the dealership, from transaction-based to a more consultative and ongoing experience.

One Day, Maybe: Autonomous Cars

Consultative vs. Transactional. That’s one of the possible future states that may come about as a result of Augmented Reality and Autonomous Cars. And while AR is a device-driven experience that changes aspects of the sales experience, the evolution of mobility may well change virtually everything about the automotive space. Development continues, with particular focus on recent accidents involving Google’s self-driving car and Tesla’s auto-pilot feature. And while it’s too early to tell how it will impact the retail environment, the emergence of this technology points toward the transformation of retail from solely transactional into a more complete, consultative experience. According to The Future of Auto Retailing: Preparing for the Evolving Mobility Ecosystem, (a Deloitte University Press Study) dealerships may end up “combining online shopping with in-store guidance, where the car buying experience manifests itself as an extended “test live” period (rather than a test drive), during which a customer could gauge how the car improves daily life; a partially customized vehicle could take the form of a “base” configuration augmented with tailored entertainment and productivity software.”

That’s crystal ball stuff, to be sure. Regardless of what amazing innovation makes the greatest impact to the business of automotive, one thing is sure: it’s a great time to be a part of a business that’s moving toward new ideas and innovations sure to make life better, more productive and profitable.    

I first realized that Pokémon Go was changing the world when I saw the signs on the New Jersey Turnpike:

Don’t Pokémon Go While Driving!

This was a little startling. I knew all about the game, but didn’t realize it had reached such a critical mass of acceptance and enthusiasm until I saw roadway warning signs. Indeed, upon a little research, I learned that Pokémon Go had turned the world upside down. According to AppInstitute.com, daily time spent on the game (iOS) is an astounding 33 minutes – about 10 minutes longer than Facebook. In the U.S. alone, the app has 23 million peak active users, more than any other game by a healthy margin. And get this: in the five minutes or so it took to write this passage, the game was downloaded over 210,000 times.

All this success, while partially due to the latent popularity of the trading card game from the 90s, is driven by Augmented Reality. Also referred to as AR, the technology places a computer generated image on a user’s actual real view. From a commerce point of view, it’s a powerful tool – and has been steadily moving toward the mainstream for a while. But investment hit the turbo button last year: According to CB Insights and eMarketer,investment in AR jumped from $144 million in Q1 2015 to $238 million in Q4 – then exploded to $1.08 billion in Q1 2016.

All that investment is beginning to show up – and one place we might see more of it is at the dealership. Earlier this year at the Mobile World Congress, in fact, Fiat Chrysler Automobiles (FCA) unveiled an AR car configurator, built by Accenture Digital and using Google’s Tango developer kit. The prototype showed how people could interact with a full scale version of a car; Accenture’s objective is to enable a buyer to use a mobile device to “walk freely around a full-scale vehicle in almost any environment.” It’s possible because Tango enables an untethered, handheld experience free of external tracking technology like GPS. According to TechCrunch (in an article found here), Tango gives devices a sense of location – a sense of “where they are in a room, and what’s around them.”

The first device enabled with Tango is scheduled to debut this September. Like FCA, chances are it won’t be long before more dealerships and automakers start experimenting with AR. Indeed, from a global perspective, quite a few automakers are already engaged in testing the technology, including Ford, Land Rover, Ferrari, Porsche, Audi and others. For dealerships, one only needs to imagine the walk-around and F&I product sales possibilities to see how effective this technology can be, and how it can be used to blend the online and in-store experience. Ferrari, for example, has used AR to reveal additional information and features while a customer is walking around a model in the showroom. Land Rover has leveraged the technology to showcase upcoming models. With a prototype at the dealership, a customer can experience an actual preview of the features upcoming. On the F&I side, buyers would view their vehicle as it would look equipped with aftermarket items – creating a very personal approach.

Of course, it’s fun to gaze into the looking glass and see what types of technology may be coming down the road that will help dealers create a more interactive and effective car sales experience. It’s pretty likely, though, that AR is headed to dealerships – and soon – in some capacity. That makes a lot of sense, because let’s face it: as automotive retail continues to evolve and transform, technology like Augmented Reality could very well be an ideal way to bring the two together, and create a total immersive and blended experience within the showroom.

It’s been debated at conferences, in showrooms, talked about over dinners, written about, studied and queried. Still, the question – and the debate – rages.

Mobile. Does it fit in the dealership showroom?

The short answer is yes. Of course. And if you’ve not integrated mobile devices throughout your sales showroom experience, consider the overwhelming amount of data that points you in that direction, such as a recent 2016 survey from Ipsos – commissioned by Facebook IQ – that examined the behaviors and attitudes of mobile-first auto consumers. The study found that “71 percent of all respondents use mobile during the purchase process, and 58% say their smartphone is likely to be the only device they use for all their vehicle research in the future.” Additional findings include:

• 61% of mobile-first auto consumers say that video is playing a more important role in their shopping experience.

• 76% of mobile-first auto consumers know the exact vehicle they want before going to a dealer.

• 71% of mobile-first auto consumers prefer to do all their vehicle research online, and go to the dealer for the final transaction.

Indeed, mobile is the way of the world, to the point where a Google analysis of search data between 2014 and 2015 showed that auto category searches on mobile grew an amazing 51%.

But wait a minute. Just because it’s the way of the world, does that mean it’s the way of your dealership? Does it matter? You bet it does, for at least one compelling reason: it’s how consumers want to experience the journey of buying a car. It’s convenient, familiar and welcome technology. They want video on the tablet; they want to continue to shop in a way they recognize as credible and transparent.

By connecting “online to in-store” via mobile device in the showroom, you’re creating a familiar, modern, shopper-friendly environment that picks up where the buyer left off online –and that itself feels credible and transparent. The technology and interactivity of a tablet, for example, offers a much deeper level of information and a more interactive experience. That helps you to gain insight into consumer preferences and the information they have prepared online, prior to their arrival at the store. You’re then able to provide a more personalized in-store experience using mobile technology. That’s how mobile technology fits – today and as automotive retailing continues to evolve.