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Jared Hamilton
From: Jared Hamilton
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Customer Experience Study Identifies Expectation Gap Between Dealers and Consumers

We at DrivingSales recently concluded a very thorough customer experience research study revealing clear indicators that trust and transparency are paramount for sales growth and future success in automotive retail. The DrivingSales Consumer Experience Study is based on a 16 month-long ethnographic and quantitative research initiative with over 1,300 shopper and buyers. 

This unique type of research study looks at the rational and emotional factors that cause modern automotive shoppers to connect, or disconnect, with automotive dealers in the buying process. The ethnographic element of this research provides substatial validity to the study as it has not been done in the automotive retail research space while studying customer experience. 

Driven by experiences customers have become acustomed to in other retail sectors, the study uncovers large consumer expectations changes that are eye-opening for automotive retailers. It's clear from the research findings that a fundamental change in the consumer experience is required if dealerships expect to remain competitive over the next 5-10 years. 

Here's a few key findings from the hundreds of insights collected include:

  • 99 of 100 automotive shoppers begin their purchase journey expecting it to be a “hassle” driven in large part by their experience, and that of friends/family, with retailers seeking to control the buying process to the retailer’s objectives
  • Shoppers are exposed to dozens of conflicting influences making them wary and distrustful, driving them to seek what they perceive as objective information from trusted sources – primarily trusted friends and family and independent third party sites
  • Shoppers are keeping dealers and sales people at a proverbial arms length until late in the purchase process. When they’re ready to interact, 61% initiate contact by walking into the dealership without prior contact
  • This distrust puts the consumer on a hair trigger as they engage with the dealer, 50% will walk out of a dealership if the dealer requires a test drive before providing a price, 43% if personal information is required
  • 56% of shoppers said they would buy more often if the dealership process was not so difficult - the impact of this retail aversion was quantified at a potential increase in sales volume of 24%

“Yesterday’s formula for automotive retail success is deterring consumers and suppressing sales volume. Our research shows the key to sales success today is building trust through an open and transparent customer experience at every stage of their buying process,” said Jared Hamilton, Founder & CEO of DrivingSales. “Our findings are a clarion call for change in how cars are retailed and provide practical guidance to retailers and manufacturers on how to bridge this customer expectation gap and advance the industry.”

We will be releasing more of the DrivingSales Consumer Experience Study in the coming months. 

David Ruggles
I hope at some point people who do surveys to prove what they already thought will understand that what people say answering surveys and how they behave in a real world scenario are often exactly the opposite. Consumers don't know any more now than they did decades ago. They have vastly more information but can't unpack it well. After all, the complexity that exists today is exponential compared to a few decades ago. Its like drinking from a fire hose for them. It has always been about creating the perception of the good deal, today, in the future, and in bygone decades. Don't expect car buyers to suddenly become reasonable. They have all of this information, the ability to shop and buy in an environment where dealers are already selling new cars for breakeven. If that doesn't make them happy, what makes you think they will EVER be satisfied? As always, auto retail is about satisfying a percentage of consumers in such a way that we can move some metal and cover our costs. As always, customers DO want to play the game. But they want to be guaranteed a win. Fact. They are already winning and they still pout and complain generally. We don't make money selling new vehicles in auto retail. We barely recover our costs.
David Ruggles
RE: "56% of shoppers said they would buy more often if the dealership process was not so difficult - the impact of this retail aversion was quantified at a potential increase in sales volume of 24%re your thoughts here." Saying it and doing it are two different things. Just because a consumer visits a dealer who doesn't meet their expectations, doesn't mean they exit the market. The exit the dealer and visit another until the find a combination that is conducive to them doing business. The idea that they just don't buy is ludicrous on its face. There is no perfect way to sell cars. There never has been. There is also no "old way" of selling cars. To even imply this is the height of ignorance. I started selling cars in 1970 in a One Price store. I hear Mark Rykess and others trying to characterize the "old way" as some kind of ignorant neanderthal sales process as if all dealers did things the same. That's just false. I've seen a LOT of efforts by geniuses trying to sell cars the way car buyers say they want to be sold in surveys. Most fail miserably. The ones who survive do so because of a combination of untypical conditions based on the demographics of their market, low overhead of their dealership, and/or the brand they sell. For those who think a little transparency is good, so total transparency will sell everyone, try posting your triple net cost and advertising your margin. That's transparent. That'll work, right? Consumers are so reasonable they will gladly pay your overhead because you are so transparent. They fact is Mr. Dealer, your own employees don't understand your overhead expenses. Do you expect your customers to?
Ed Brooks
@Evan & Mike - For years some folks have said the "Lead" is the goal in online marketing. This study may be changing their minds. You don't need to generate a form-fill lead to be successful -- success is measured by sales. The biggest issue that must dealt with is attribution.
Mike Jeffs
@Paul-Good question! There are various processes dealerships practice that customers do not like and consider to be a hassle. One of them being a customer has to provide their personal information to simply get a price of vehicle or go on a test drive. That's just one of example of many, but the bottom line is the research found most dealerships have a particular sales process they follow and if the customer wants to do it differently the customer is out of luck. For example, if the customer comes into the showroom and knows the car they want to buy and wants to get straight into crunching the numbers or working on the trade in, the dealership will often resist and strongly encourage the customer to follow their sales process rather than adapting to the customer's needs. Customers also do not want to spend 4-5 hours of their Saturday buying a car and having to wait. The process is too long. Easier said than done to shorten it for sure and it won't be an overnight fix. Trust is the biggest driver here, Paul. It's taking customers too long to feel like they are getting a good deal – that starts as early as the customer searching the dealers website for pricing and vehicle availability. Because customers don't trust dealerships, they don't trust the information on their websites. Does that answer your question? Interesting feedback on how your customers responded to your one price store. Has anyone else tried rolling out one price?
Shane McInnes
Great information. It seems to me that I am seeing the demand for authenticity and transparency grow all the time. Bill Gates stated that "transparency" will be a main theme for him as he enters the automotive industry. However, it is still my everyday experience (mentioned by others as well) that our clients want to feel as if they have "won". They seem to want to trust us yet they also want to triumph over (nice way of saying "beat us") the sales rep or dealer. It seems to me that this is very paradoxical. I prefer to serve from the virtue of authenticity and to be transparent as it is easier and let's face it....the right thing to do. Maybe I am too idealistic in my style but it is a philosophy that I can get grounded in, train on and behave according to. The challenge my team and I face is that some folks seem to want to play another game when it comes to buying a car. For example they will say they don't want to negotiate but then they begin to negotiate.

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