If there is anything we have learned over the past year, it's that the automotive industry is filled with some of the most resilient people on the planet. Foot traffic dwindles, and we lean into our digital showrooms. Inventory issues from the factory? We pivot our attention to the used car market. Auction vehicles hard to come by? We'll acquire inventory directly from consumers. Don't have the inventory people are looking for? We'll trade with one another. And while we all hope for some form of normalcy soon-- we are masters at navigating the volatility in front of us.  

And we have sold a lot of cars in the past 12 months. More than I think anyone thought we would during a global pandemic. And yes, we leaned heavily on digital sales platforms to be successful, but the truth is-- consumers did not buy those cars on their own. Your teams worked hard to guide them through the process along the way.

In fact, according to a recent study conducted by Roadster & NADA, 86% of people who bought a car in the past six months interacted with someone at the dealership remotely. We are at a point now where the majority of car buyers are doing some part of the transaction online. Still, even the small percentage of customers who bought sight unseen said they were guided through the process remotely by someone at the dealership. 

Digital retailing is 20% technology and 80% what you do with it. Don’t just plug a digital retailing solution in and hope it rains sales for your dealership. Be proactive and use your digital sales tools with every customer. The more you do, the greater the reward.

Digital retailing makes the transaction faster.

84% of car buyers surveyed said that this purchase was more efficient than their previous purchase. Not only is this a staggering number, but when you break this down by how much of the transaction the customer did online, you can see that the more they do digitally, the more likely it is to be a faster transaction than their previous purchase.

As an industry, we have shaved one hour off the process via remote selling (1.43 hours vs. 2.5 hours in 2019), and the percent of consumers reporting that the transaction occurred in less than an hour is now close to 40% of all buyers.

But, it isn’t just the consumer that is getting faster. Your salespeople are getting faster, too. At the height of the pandemic, we saw salespeople sell 40-50+ cars a month and deliver them to the customer. Sure, that was crazy times, but one year later-- salespeople who use digital retailing with every customer are still seeing a 62% increase in productivity vs. pre-pandemic days-- that’s an average of 16 units vs. the 10 units per person that has been the benchmark for over 35 years!

Digital retailing with every customer improves customer satisfaction.

Customer experience has become a massive focus of the automotive industry-- from dealers to manufacturers and marketplaces. And, rightfully so, when you look at the retail experiences that people have every day of their lives from Amazon to Instacart. 

For years, we have known that customer satisfaction is tied to time-- an area we finally see improvements upon, as mentioned above. So what’s happening with satisfaction? It is going through the roof for customers and dealers who use digital retailing. Our study measured this in two different ways-- consumer Net Promoter Score (NPS) and dealership growth in CSI when they use digital retailing.

On the consumer side, Net Promoter Scores skyrocketed for those who bought 100% online. When we asked if car buyers would recommend the dealership to a friend or family member, the percent of promoters (9s and 10s) wildly exceeded the detractors (6 and below), resulting in an NPS of 77 vs. 28 for dealers where the purchase happened exclusively in the showroom. The score for online buyers beats out Apple and USAA, two brands we know have captured the hearts of customers everywhere.

And it isn’t just consumers either. According to the dealers surveyed, 78% of rooftops saw significant increases in CSI scores when they used digital retailing with every customer. Increased CSI does more than give us a pat on the back. It means more referral business, increased loyalty, and brings a load of OEM benefits to boot. So, the more that you use digital retailing in your dealership, the higher your CSI score will be.

The more you use it, the more online sales you will see

For years, Roadster has stayed away from promising more online sales with digital retailing. Truth be told, it is not the tool itself that drives sales volume-- it is how you use it. And while COVID drove the majority (89%) of dealers to adopt a digital retailing solution, less than half of them use the tool proactively with customers. How dealers use digital retailing matters. And, the more proactively you use it with every customer, the higher the ROI will be. 

So while we wait for the percent of customers who buy 100% online to grow into the double digits, there are dealers who can attribute 80-90%+ of their sales to digital retailing because they use it with every customer. Every customer receives a link to start building their deal. They see a payment presentation in the showroom. They are encouraged by the salesperson to do their credit app and trade-in online, and they are shown F&I both remotely and early in the showroom visit with the salesperson.

And when they do, the one metric everyone worries about related to digital retailing gets better-- profit. According to our study, 73% of dealers made the same or significantly more F&I profit with digital retailing vs. without.

What’s good for the customer is good for business

Not only are we saving the customer time by offering a digital buying experience they can use from anywhere, but it is allowing our staff to be more efficient, too. As I mentioned above, we saw a staggering number of units sold per person during the height of the pandemic. You can critique this and say -- oh well, that was because our staffing levels were so low and our teams were working around the clock. I do not doubt that this is true. But, if we take a step back and look at what we thought was possible before the pandemic, things would not have looked this way. 

You see, despite the staffing reductions, the inventory issues, and all of the other things that have been thrown our way-- efficiency gains have been unearthed by empowering the customer to do more of the process. Our people can now work with multiple customers at one time, all at different stages in the buying process. 

These are efficiencies that we can carry forward to gain more market share, regardless of how big or small the pie is at any given time. And while staffing levels are back to normal, and profit profiles are looking good-- the dealers who use digital retailing with every customer now are winning-- their salespeople are still averaging 16+ units per person. When inventory returns, they aren’t going to have to add staff. Their process is going to be faster than yours, and their customers are going to be happier.

To review all of the insights from our latest Dealer Impact Study, click here.

I was asked recently why some dealerships are wildly successful with digital retailing and others are not. It was a fair question and one that a lot of dealers who onboarded with a digital retailing solution over the past few months are probably asking themselves right now.  Immediately, people start to pontificate during these discussions -- does it work better in major metro areas? Is it best for high volume stores, or perhaps those that are more geared toward used cars vs. new cars? While some of these things can certainly play a role, I can tell you firsthand that they are not the primary drivers of success.  After over 2,000 implementations at Roadster—the #1 reason we have seen one dealership succeed while another one fails is “process.” Have you evolved your sales process to account for all of the digital sales capabilities now at your fingertips?

“When it comes to digital retailing, you have to think strategy first and foremost. You need to incorporate it into everything you do, from marketing to lead response and your be-back process.” —Wendy Bulmer, Acura of Moncton.

This is not new news. If you have seen any of our whitepapers, webinars or speaking engagements, you already know we talk about process a lot at Roadster. We say that success is 20% technology and 80% what you do with it. The COVID-19 pandemic has put an even greater spotlight on this phenomenon. With demand down, reduced staffing, and many dealerships at one point restricted to online selling or open only by appointment -- process became everything. It took a strong operator to think on their feet, adapt their sales process, and get everyone up to speed with remote selling technology.

“It isn’t about the tool, it is about putting the right process in place and then finding a technology partner that can digitize it from start to finish. Roadster offered everything we needed to make that happen. I’m not sure how we did business before Roadster, but we are so glad they are here to support us and any changes we make along the way.”  —Frank Bystricky, Executive GM at Infiniti of Akron

Overnight, the demand for online retailing went through the roof. Dealers who had planned to implement some kind of modern retailing solution in the near future found themselves quickly implementing digital retailing tools in order to survive. Contactless test drives and deliveries cropped up around the country, and deals were done via phone or 100% online. With limited staff, dealerships had to implement modern techniques to empower those who remained, to do more. When we studied this phenomenon in partnership with NADA, we found that salespeople could sell a lot more per person with a remote selling mode, and as a result, ⅓ of customers reported that their transaction was done in under an hour.

Here is the dirty little secret though—to truly modernize the car buying process, you have to make it easier to sell.

At Roadster, we learned this early on when we realized that we were providing car buyers with more transparency than the sales staff at most dealerships had themselves. It quickly became apparent that we needed to invest heavily in tools that give the dealership access to information and allow them to work deals to completion, whether the customer was online or in-store. Today, most digital retailing solutions are primarily e-commerce focused, leading many dealerships to believe that if they have the tools for a customer to complete the transaction on their website, customers will do this en masse. And while the industry did see an increase in these transactions as a percent of total sales in April and May, it still represented less than a quarter of the car-buying population.  But what if your team had tools at their fingertips to proactively guide every customer through a digital process? What if that same technology could be used regardless of the customer’s location -- online or in your showroom? What if by using these sales-specific tools the team could be more efficient, sell more cars, and exceed customer expectations?  

Digital retailing (aka online retailing or e-commerce) is only one aspect of the bigger picture. You need a complete Digital Sales Platform that connects the customer journey with the selling experience.

Your sales team plays a HUGE role in the customer journey. Their ability to effectively and efficiently transact is paramount. If your employees don’t feel empowered, if they feel like they are constantly seeking approval or working out of antiquated systems that limit their ability to sell, they will get frustrated and leave. With so many unknowns as we march toward the end of 2020, dealer principals are being more discriminating with their expenses than ever before. With personnel being the largest cost center, they are looking at the people and skill sets that are truly needed to weather the storm. A Digital Sales Platform pulls the buyer and seller experience together in one place, making everyone more efficient. Similar to a point of sale solution in other retail categories, it can be the fiber that connects all of your backend systems together, offering a shared experience with your customer. Over the past few years, Roadster has been focused on further building out our platform with the seller experience in mind. We have looked at each role within the variable ops team, and have been methodically rolling out capabilities with each persona in mind. Here is an overview of some of the features and functionality.

Showroom Agents

Most of 2019 was spent focusing on the showroom presentation process. We built a robust “check-in” capability to connect the dots between what customers did at home and their in-store experience. Showroom agents can easily see what vehicles the customer was looking at online, how many deals they have configured, and any purchase steps that have been completed. They can do a needs assessment using the Vehicle Recommender or SRP, compare trims, pencil deals, and even adjust pricing side by side with the customer. If the customer becomes a be-back they have the ability to share inventory and VIN specific details for the customer to complete the deal at home.

Sales Managers

At NADA we rolled out Deal View which provides sales managers with a live view into deals being built on the showroom floor. This feature gives sales managers the visibility and the confidence that their team is maximizing profitability. It also allows showroom agents and sales managers to communicate without waiting at the desk. Agents can raise their hands in the application or send a text message to a specific manager for assistance.

Internet/BDC Teams

When the COVID-19 pandemic hit, we turned our attention to remote selling and the efficiencies that come with that capability. We began to enhance our guided selling experience, empowering the Internet/BDC agents to help customers get further down the purchase funnel online. We are in the process of rolling out the following new products and features: Express Response is a lead engagement tool that sends quality responses to a dealership’s internet leads 24/7, encouraging customers to start deal-building activities online. Our New Buy Flow and My Purchase Hub encourage customers to go deeper into the buying experience by offering flexibility with where they start and with what is required versus what is optional in consideration of what they are comfortable doing online. Within the new Customers Tab sales team will have the ability to push next steps to the customer from Roadster Admin while seeing all of the customer activity and various deals created in one place for ease of engagement. Express Store Live, powered by Live Person, digitizes the relationship-building aspect of the deal by offering video conference, screen share, and co-browse capabilities to help answer questions that pop up during the buying process. An integration with Auto Alert directly sends customers personalized offers from your equity mining efforts that can be self-desked online or in-store via your Express Store at the customer’s convenience.

COVID-19 thrust the automotive industry 5 years into the future in less than 5 months and has significantly changed both customer and employee expectations. The above is just a sneak peek at our POV and the work we have done toward that vision so far. Real modernization comes from evaluating the entire journey — not just one side or the other. You have to take a holistic approach to truly deliver upon the experience you promise to the world.

Hero Photo by Jason Tuinstra on Unsplash

It has been 20 days since the world as we knew it was pulled out from underneath us. So many devastating things are happening to people I know and care deeply about, both on a personal and professional level. Local businesses have been shut down and people are being laid off or furloughed, many of whom can no longer make ends meet. It has a domino effect across our entire society. Like most of you, I find myself full of emotion– in a state of immense sadness, full of shock and concern as very few are left unscathed. I hold this in one hand, and very close to my heart, but in the other hand I hold something else — an intellectual curiosity about where we will find ourselves once the storm has passed.

I am fascinated with the changes happening before my eyes. My daughter is now taking virtual dance and piano lessons, while my son completes Boy Scout merit badges online. I have enough teachers in my life to know that they are struggling to learn video conferencing, Google Docs, and Google Classroom so that kids across the country can finish the school year virtually. People are sheltering at home but crave human connection. I can’t tell you how many virtual happy hours I have attended, or how many smiles and waves I have gotten from neighbors as we go outside to stretch our legs. 

Professional relationships are key to moving the automotive industry forward 

I have also been checking in on beloved dealer partners and other industry friends each day. I see people banning together professionally in deeper and more personal relationships than ever before — everyone committed to helping the automotive industry get back on its feet. Competition has been put aside and everyone is sharing what they are seeing and doing willingly and openly.

Regardless of where you sit in the automotive ecosystem– everyone is impacted by car sales. Dealerships are on the front line of this and while the impact has been different across the country, everyone is suffering– some are open for business, but walk-in traffic has dwindled; others have only their service department open for parts and repairs. Many have had to completely shut their doors, laying off huge portions of their staff in order to survive. Dealership employees are either working from home, or as part of a skeleton crew with social distancing in place behind locked doors.

Yet, people are still shopping for cars

With everyone at home and technology usage skyrocketing, those in need of a new vehicle during these unprecedented times are visiting dealership websites, submitting leads, and starting the deal-making process from the safety of their home.

At Roadster, we have been monitoring online traffic volumes closely and on a national level, the number of people shopping now vs. pre-COVID-19 has remained fairly flat. Of course, this varies greatly by the metro area and brand, but even in the areas most significantly impacted by coronavirus cases, dealerships have maintained 60-70% of their traffic.

So, here we are as an industry. Our physical doors may be closed, but our digital doors are wide open. What an interesting world we have found ourselves in. If you dial back to NADA, which now feels like a lifetime ago, most dealerships across the country were in “wait and see” mode as it relates to online commerce. No one was doubting that the car buying process needed to be modernized, but there were serious concerns about staff buy-in, process change requirements, and bottom-line impact. So, while there was a growing percentage of dealerships embracing digital retailing capabilities, the vast majority weren’t prepared for what was about to happen.

Dealerships who embraced digital retailing before the pandemic are ahead of the curve.

I have spoken to dozens of our dealer partners over the past few weeks and the one thing I have consistently heard is that they felt prepared. They had done the work months (and in many cases years) ago to evolve their sales process, empower their teams, and train their personnel on what it means to provide a guided online buying experience. They had already moved past the “get them in” appointment mentality and into a world of efficiency — encouraging customers to do some, if not all, of the buying process online. Sure, their sales are drastically down, and like many, they had to cut their teams back, but they knew exactly whom to keep and how to operate. There was no huge pivot in the sales process, other than remote test drives and the litany of safety protocols they now have to follow during delivery.

These digital-enabled dealers are watching other dealerships scramble to catch up — sometimes within their own dealer groups. They know from experience that it requires more than a plug and play solution. It took them months of planning and training to get the process down and now the rest of the dealer community needs to do that work in days and weeks, not months. You see, the truth about digital retailing tools, and any technology really– it is 20% technology and 80% what you do with it. It is about evolving the way you have always done things, the roles you have always had, and sometimes even the people who have been there forever. It is about making hard choices, streamlining the process and cutting costs out of the equation. I know as an industry we talk about modernizing the experience for consumers, and that has never been truer as we focus on the health and safety of our customers — but it is equally as important to optimize our businesses to survive.

The truth about digital retailing– it is 20% technology and 80% what you do with it.

So, as we stare catastrophe in the face, we find ourselves as an industry forced into optimization overnight. It is scary. But know, you do not need to go at it alone. Lean on your dealer friends who have done the work already, and your partners in the ecosystem to help you fast track through it.

What will our businesses look like post-COVID-19? What will any business look like for that matter? The world around us is being optimized for virtual and online activity. We are training our country on just how much can be done remotely. There is no doubt in my mind that life as we knew it will be changed forever.

Just remember, we’re all in this together, and as an industry, we will weather the storm united.

Michelle Denogean is the Chief Marketing Officer of Roadster, the leading Commerce Platform for the automotive industry, where she oversees Marketing, Insights & Analytics.

To see what other dealers are doing during this unprecedented time, visit the Roadster COVID-19 Resources section, or join our weekly live discussion with dealers around the country. 

In a world where it feels like every industry pundit has provided their 2020 predictions, we wanted to hear directly from those who hold the purse strings — dealer executives responsible for running dealership operations day in and day out. So, we interviewed some of our top dealer partners to see what they had to say. We asked them what trends they felt would come to fruition in 2020. How will the sales process evolve? Will Digital Retailing continue to grow? How will dealers attract top talent? What will help them maintain their competitive advantage? What else do you think dealers need to prepare for?

Here’s what they had to say:

PREDICTION 1: Digital Retailing Adoption Will Continue To Grow

Ok, in all fairness, we did only ask people who are using Digital Retailing today. However,  we think it is important to hear WHY they think it will continue to grow BECAUSE they are using it.

Christian Storm, Training & Development Manager at Planet Automotive in Colorado believes that the growth in Digital Retailing will be driven by customers reading reviews about the experience it enables and coming to dealerships expecting that type of experience.

Our research backs this up as well. As of this year, millennials will make up the largest segment of car buyers at over 40% of the car shopping population. And if there is one thing we know -- Millennials tend to buy things online. In fact, according to a UPS Pulse of The Online Shopper report, 54% of all millennial purchases are made online. With that said, when it comes to car buying, they still want to test drive the car over 60% of the time, according to a recent MSN Study. So, dealerships need to be prepared to enable customers to do some or all of the process online before they get there. Pair that with the fact that almost all Millennials read local business reviews online and you have a winning recipe for Digital Retailing success.

Jeff Miller, GM at Mark Miller Subaru in Utah, spoke about how continued adoption of Digital Retailing will be fueled by OEM requirements. The development of OEM Certified Digital Retailing programs took shape over the course of 2019, with Audi, Mercedes, Lexus, Toyota, Hyundai, VW and Subaru leading the pack. 

Of course, it doesn’t hurt that some of these OEM programs subsidize a portion of the cost. In a world where profits are declining, every little bit helps. Especially for tools that can assist dealerships with expediting the purchase process, leaving time to introduce the customer to incremental profit centers such as F&I, accessories, and service.

Brendan Harrington, VP at Penske Motor Group, thinks Digital Retailing will help the industry make progress toward more transparency. While many dealerships have become a lot more transparent, there is still room for significant improvement. As customers experience transparency via Digital Retailing solutions, the dealerships that do not fully embrace transparency will suffer.  

Brendan also believes that the spotlight on customer experience means investing in longer return policies and providing customers with the ability to test-drive vehicles from the comfort of home -- both trends that align with the retail industry evolution outside of automotive.

PREDICTION 2: Technology Will Evolve The Sales Process

In many of our recent dealer interviews, friction amongst staff has surfaced as a huge pain point related to employee & customer satisfaction. As anyone who has worked in a dealership knows, the long line of salespeople queued up next to a sales manager’s desk is not the most efficient use of anyone’s time.

Both Brendan Harrington and Mike Ebrahimian, GM at VW Sunnyvale talk about this pain point as the problem to solve in 2020. As Brendan states, the ideal process would include further empowerment of the sales professional.

Our belief is that when this becomes more commonplace, managers will be free to get up from behind the desk, interact more with customers, and coach their teams to drive incremental sales.

Mike talks about how we can also reduce friction by empowering the customer to execute the whole deal from beginning to end in one place, ideally on the dealer website. The idea is to enable the customer to do much of the work ahead of time and finish it in-store; reducing much of the back and forth, as well as time spent completing the transaction. Putting these two strategies together is a power punch, leading to significant efficiency gains.

Of course, there are other areas of the process worth tackling. Brendan & Jeff talked about quicker and more accurate trade valuations, e-contracting, and digital paperwork as linchpins to completing the deal 100% online. Christian also talked about the power of video both online and in-store as a significant differentiator for dealerships to explore.

All of these viewpoints reinforce the fact that digitization of the sales process is here to stay and 2020 will be the year that more dealerships will embrace it.

PREDICTION 3: Employee Retention Improved With A Streamlined Sales Process

As mentioned above, the digitization of the sales process is the name of the game, and this can have a positive effect on both recruitment and retention. Mike predicts that digitization will help better define employee expectations, leading to happier customers, happier employees, and less turnover. He is already experiencing this himself as the time to onboard new employees has shrunk from 2-3 weeks to just 2-3 days.

And what about retaining employees? Christian says that defining a career path for people entering the industry is the key to success.

And who are the companies that dealerships will lose staff to? According to our Millennial Job Satisfaction Study, Amazon and the Apple Store make the top of that list with 94% of millennials saying that technology plays a critical role when choosing their ideal job. To retain employees, dealerships should focus on reducing high pressured sales tactics, moving to a more salary-based compensation plan, and offering flexible work schedules. Not only will this help retail employees, but it is a significant driver in attracting new talent.

Of course, there are other factors -- Brendan feels strongly that people flock to success and that dealerships need to position themselves as the place that the best flock to. This starts with being clear on what success means to you and sharing your dealership’s goals and achievements with your entire workforce. Not only can this bring staff closer together, but it will nurture a culture of growth and positivity.

PREDICTION 4: Continued Focus on Customer Experience, Consolidation, and Electric Vehicles

While these themes are not new for 2020, the fact that retailers see a continued focus on them is very telling. We believe that customer experience will continue to be the overarching theme that dealerships around the country need to focus on for the foreseeable future.

As such, weaker stores who do not adopt this mindset will start to struggle more. According to Brendan, the strong will gain market share while the weak will be sold, consolidated, or shut down.

Christian believes that efficiency even extends into our vehicle selection with EVs continuing to grow in popularity. He urges dealerships to embrace this new technology by being able to speak the EV language. Vehicles are already being held on to longer, and EV technology will elongate this further. Sustainability is not a topic to be overlooked as it relates to serving your future customers.

Serving future customers is at the center of it all. And the best way to ensure a great customer experience is to standardize it. This speaks to our final prediction, which is one of our own -- Dealer groups will take a much more active role in standardizing process across all of their stores to ensure a consistent and seamless experience. People who cannot get on board with their vision will find it hard to maintain their place within the group, no matter how successful they have been in the past. 

So there you have it-- the retailers (and Roadster) have spoken. We would love to hear what you think. Anything we missed?

When you think of amazing omnichannel experiences, do Walmart, Target, Best Buy and Apple make the top of your list? They did for the 1,000 people we surveyed who regularly shop both online and in-store. The goal of the survey was to understand which industries provide omnichannel shoppers across the country the best and worst retail experiences. To be honest, I had to sit with the Walmart finding for a while. My in-store experience of Walmart is full of uncertainty about inventory location, as well as long lines in the self-service checkout area.

However, when I unpacked this finding, I found that the key to these retailers' success is the strong connection they have built between online and in-store activities. The accessibility of a physical store and knowing the inventory they have in stock for in-store pickup has been the key to their success. Walmart’s entry into the grocery business reinforces this point as the grocery industry ranked #1 in Best Overall Customer Experience, according to our survey. Cable and automotive industries came in last.

Many articles point to omnichannel capabilities as the reason for such high scores. In addition to customer service, free shipping, and easy returns, almost 50% of consumers said that having a consistent and connected experience between online and in-store is a significant driver of satisfaction. With brick and mortar stores blending their online and offline experiences in order to stay relevant, consumer expectations are growing rapidly.

This leads us to automotive retail, rated as the industry second-most in need of modernization, behind only the cable industry. I recently came across data from Qualtrics stating that the Net Promoter Score for automotive retailers has declined significantly over the past 3 years, going from 48 to 39. It isn’t that the experience has taken a turn for the worse, it is that customer satisfaction with car buying is influenced by the buying experiences consumers have elsewhere, especially for everyday purchases like they would make at the Apple store — fast, easy & transparent. In fact, according to our survey, the #1 modification that would improve the car dealership experience is keeping the salesperson with the customer from start to finish, which would streamline the experience and build more trust. For the first time, we see this has become just as important, if not slightly more so, than transparent pricing and inventory selection. 

This finding ties back to the Time Study Roadster did at the end of last year which found that salespeople tend to leave a customer’s side on average every 20 minutes, resulting in an hour of time wasted. In a world in which we have been conditioned by the likes of Amazon to expect same-day retail gratification, it is not hard to believe that customers want to expedite the car buying process. The more they can do digitally before they head into the store, the better. 

And, here’s the real kicker. More than half of consumers we surveyed said that having a positive experience is even more important than price. In fact, 80% stated that they would pay up to 10% more to ensure a fast, transparent & painless car buying experience. Great news for the bottom line of the industry at large.

While the technology to facilitate this type of experience is available today, it isn’t automatic and it doesn’t happen overnight. It takes preparation and planning to modernize a shopping experience and connect online experiences to the in-store transaction. The reality is that you won’t get it perfect out the gate. When we talk to our most successful dealer partners, they tell us that having a plan and being prepared to iterate on it is an absolute necessity. 

As I mentioned at the start, my own in-store experience at Walmart has left much to be desired. Even Walmart hasn’t gotten it 100% right yet. It is a good reminder to not be too hard on ourselves as we adapt to change.

But, isn’t it time to at least start?

Want to learn more? Email us for a full copy of the report. 

A few weeks ago, our COO Rudi Thun wrote a blog post on the most important role in dealerships that often goes unfulfilled. He called it a Digital Retail Manager, but call it whatever makes sense to you—it is about having someone with the political capital to drive process change across all departments within the store. We have gotten a lot of great feedback on this post, many asking where a dealership may find this kind of talent and even questioning whether just one person can manage the role.

Regardless of your perspective, the presence of a strong champion is the #1 predictor of success with digital retailing; the numbers don’t lie. Stores with champions see customers digitally build deals at four times the rate of those who don’t have this role in place.  

Why? Because on the road to modernization, champions build the new process, help train the staff, oversee the technology implementation, and continuously monitor utilization. As you can imagine, usage is the key to driving 4x the performance.

It is equally as critical that you have a Dealer Principal, Dealer Group Executive, or General Manager that understands the importance of this role and gives their champion(s) enough autonomy to get things done. 

Do these people really exist? Yes, without question, they do. Rene Lawson at Penske Motor Group, Dan King at Sun Automotive Group, and Joe Lukich at #1 Cochran to name a few. They are process-driven, respected, and team-oriented. They see a way to get things done regardless of organizational resistance, system complexity, or short-term hiccups. They aren’t afraid to take a step back to take two steps forward. 

Take Rene Lawson, Finance Director at Penske Motor Group. When she was at Longo Toyota, she had the vision to go digital and remove as much paperwork in the store as possible. She was initially met with a lot of resistance from people that have been at the dealership for decades—yes, decades (incidentally, Longo has the highest employee retention rate I have seen in the industry). Rene eased her team into the change, giving them a month to try a digital credit app. At first, she only required that they use it during the week, leaving busy weekends for the paper credit app if desired. Rene worked hard to gain their trust and buy-in of the new process while proving it to be more efficient. She eventually gave a date that paper credit apps would be completely removed from the dealership…and that’s what happened; everyone got on board. 

Another excellent example of a successful champion is Dan King, COO at Sun Automotive Group. The dealer group studied digital retailing platforms for 18 months before deciding to jump in. During that time, they were watching Carvana and studying the positive experience provided to their consumers. Todd Caputo, CEO at Sun Automotive Group, had some particular changes in mind for his stores. He wanted to go to a one-price model and take costs out of the equation by transitioning to a one-person selling model, thus eliminating his BDC and Finance departments. Knowing how big of a change this would be, Todd turned to Dan to carefully plan the transition.  Dan recognized up front that they would lose staff who wouldn’t be able or willing to make the changes, and he set out to hire and train new personnel before making the cutover.

Employees had to show their commitment to the way the store would be run moving forward. They turned over 90% of their staff during the transition, but those who stayed now love it. They are working fewer hours and selling more cars than ever before. Now, Dan hires employees from the likes of Red Lobster, Best Buy and other local retail outlets for their customer service expertise and pays them a salary vs. just commission. This focus on customer experience has drastically improved the tone of their customer reviews and has reduced the store’s expenses by hundreds of thousands of dollars. It wasn’t easy. They did take a step back in backend gross when the sales team first started selling F&I, but they are now five months in and are seeing these numbers rebound. Todd and Dan aren’t looking back.

“You can’t just implement digital retailing and leave it at that. If you don’t evolve your entire business and culture, it won’t work… And it has to–If we can’t compete with Carvana and CarMax, then we lose our business.”  – Todd Caputo, Sun Automotive

Our third champion is, Joe Lukich from #1 Cochran His role was literally born out of the need for a champion. COO Denny Patton wanted to modernize the #1 Cochran experience and reduce the time spent per transaction, so he found a technology solution that could facilitate these changes and put Joe at the helm of making it happen. Denny shows up at each dealership to kick off training sessions and to make sure his teams know that Joe is responsible for ensuring their success.  Joe’s title: Variable Operations Process & Training Manager. He rebuilt the entire sales process and wove digital retailing into the #1 Cochran onboarding guide. He has led the transition to salespeople penciling deals on iPads in-store, works closely with the Internet and BDC teams to roll out consultative talk tracks, and ensures that the CRM integrations are configured to adopt digital retailing to its fullest. 

Champions get things done, period. They audit their processes and reinforce utilization; they develop a go-to-market plan, demanding nothing but marketing and operational excellence; they think through the lens of the customer and employee experience from A to Z; they pull reports, adjust processes, train teams and sweat the details. 

“If you really want to do this right, and create a customer experience that maximizes Digital Retail Tools and Processes, no one has this thing figured out yet. Logistically speaking, there are so many nuances you have to figure out that are so dealer-specific that you need to have someone that helps build this from the ground up within your dealership.”  – Joe Lukich, #1 Cochran 

Each of these individuals is an amazing human being. I feel lucky to know each of them. And while the Champion role is often missing in most dealerships, when it does exist, the people who fill it are the unsung heroes. More than anything, they are givers, open to sharing their experience with anyone curious about what it takes to be successful. They show up every day, and they get things done.

So ask yourself, does this person exist in your dealer group or at your store? Refer back to Rudi’s job description to be sure. If you have someone, give them a shoutout in the comments. Heck, give them a raise; they deserve it.

If you don’t have one, please rip off our job description and get it posted for your store ASAP. You will thank me later.  

Anyone love their phone company? If you are like me, there is nothing I abhor more than needing to call them. Every time I call, I have to do a bit of meditational breathing and mentally prepare myself for what will inevitably be hours of frustration. Not only will there be excessive hold times involved, but I will also be bounced from department to department, left dealing with several different people and having to repeat my issue over and over again. If I’m not disconnected along the way, it feels like victory. Sound familiar?

Now, compare this to the Apple store experience. I make an appointment online, walk into the store at my designated time and get assigned an Apple Genius who will help me every step of the way. Not only do they stay by my side, but they are empowered to answer questions and even ring me up right there on their iPhone when I am ready to transact.

And so there it is — the world we live in, shifting between these two contrasted experiences. And the more Apple-like the world gets, the more we are unwilling to deal with extended wait times and poor customer service.

What would happen if the phone company empowered their frontline employees to help with all of the situations they may be faced with? Think of the minutes a customer spends on hold before resharing the same story 2, 3, 4+ times; or the minutes employees waste transferring people around and listening to the same stories their colleagues have already heard. Would one person be more efficient? Would customers stop dreading the experience and — dare I say — even find it enjoyable?

This is happening within the automotive retail sector as we speak. Progressive dealers around the country are deploying technology and empowering their sales teams to streamline the entire process.  And while many dealerships refuse to change, most sit somewhere in between — trying to enhance the experience, but without the tools or buy-in to make it stick.

As we head into 2019 and a world of declining SAAR, customer satisfaction and efficiency are going to be critical areas of focus for dealers to both obtain and retain buyers. As the CMO of a technology company in the space, let me be the first to say — technology itself is not enough to accomplish these goals. How you train and empower your teams to use the technology and streamline your operation is the key to a successful future.

Don’t believe me? Late last year the Roadster team set out to put some data behind this phenomenon. Not only did we survey over 1,500 consumers, but we also observed “transactions in the wild” at eight dealerships, representing six different brands. Here’s what we found:

Customer satisfaction significantly drops every time the salesperson leaves the customer’s side.
 

Thanks to our friends at AutoTrader, we already know that satisfaction drops significantly after the customer has spent 90 minutes in your showroom. We also know that customers are relatively pleased with the salesperson (73% satisfied), and that time is the true killer of satisfaction.

How we reduce time spent in dealership and provide happier experiences has been up for debate. But if there is one thing I have learned over the years it’s this: Doubling down on your strengths is the fastest way to success. 

If people are generally happy with your salespeople, keep them with their sales professional longer.
 

During our onsite observations, salespeople were leaving their customers alone every 20 minutes during the transaction to do a variety of tasks. Every 20 minutes! Not because they want to (although some admitted to doing it intentionally to create the appearance of getting something approved), but because the process you created for your showroom requires it. They must get manager approval for pricing, credit, deal terms, trade valuations, F&I product review and more.

And what were those customers doing while the salesperson was away? Whether that was texting a spouse about their uncertainty, web-rooming your competitor or doing research on 3rd-party sites — they were busy talking themselves off of your deal.

6 out of 10 times customers were re-evaluating the deal.
 

It’s time to take a good look in the sales process mirror and make the changes necessary to keep your customers with their salesperson longer.

Technology exists to remove duplication and reduce time-intensive aspects of the transaction. But training is key, as many of the salespeople observed were reluctant to use the technology available to them.

Don’t let 2019 go by without empowering your sales team to do more. Not only will it increase your customer satisfaction scores, but, if done right, it will also improve your bottom line by taking waste out of the equation.

The cost of not evolving is too high. The dealerships that deliver a great buying experience will undoubtedly earn a disproportionate share of the market. And with new dealer model threats such as Carvana, Carmax, Tesla, etc. nipping at your heels, the time to take action is now. Taxi companies did nothing to streamline the consumer experience with technology and look where they are now — Uber and Lyft are eating them for breakfast.

So, take a step forward and empower your frontline people. The game of telephone was fun as a child but has no place on your showroom floor. Keep salespeople with your customers longer and you’ll create customers for life.

To receive a full copy of the Roadster Time Study report, email insights@roadster.com

Last week my daughter needed a yellow shirt for a school dance performance. Instead of heading to the store that evening, I turned to Amazon and had it ordered in less than 5 minutes flat. And when I picked up my coffee at Starbucks the next morning, I ordered it on their mobile app so I could skip the line altogether and have my coffee hot and waiting for me when I walked in the door. Sound familiar?

In today’s day and age— time is the new currency, and it applies to every buying experience in our lives.

Buying a car is no different. It is a more complicated purchase for sure, and people still want to go to the store to test drive, ask questions and go over the ins & outs before they buy.

In fact, according to a recent study by Bain & Company— people are going back and forth between online and in-store 4x on average during the car buying experience.

But today’s discerning buyer wants to do as much as they can to complete the transaction before heading into the store to take delivery. We have all seen the stats in one form or another— The vast majority of car buyers wants to do some or all of the transaction completely online. So, in marches a flurry of ecommerce platforms to enable this.

The truth: < 10% of car buyers today will actually buy their car 100% online.​​​​​

As an industry, we need to unpack this. Time is the new currency and most customers are still coming into the dealership to complete the transaction. So, as we implement new capabilities that allow our customers to start the buying process online, we also need to think about how we bridge that efficient online capability with the in-store experience. If as an industry we implement express purchase options online but can’t expedite the process in-store we lose the customer for life.

It would be like ordering your coffee on the Starbucks app and then being forced to stand in line with everyone else to pick up your coffee when you get there.

Connecting the online and in-store experience together is what is referred to as Omnichannel Retail. Omnichannel means allowing a customer to enter from any channel and pick up where they left off– consistent and continuous.

When done right, Omnichannel Retail benefits more than just the customer, it is also great for business. By enabling the customer to do some or all of the process online, you are saving the valuable time of your sales staff, who as a result can attend to more customers. Some of our dealer partners claim to be saving 3-6 hours per transaction. And this goes beyond just what the customer can do themselves. Imagine a world where your employees have access to all of the information necessary to walk a customer from A to Z of the sale. You can redeploy resources to make your entire staff more efficient & effective.

“I don’t want to pay a sales manager to quote out the door figures, I want them coaching and training the sales team. From an ownership standpoint, I want to take them away from a low value task to a higher value task.” —Marker Anderson, Anderson Honda

Omnichannel experiences skyrocket customer satisfaction by 172% over the traditional experience, per Cox Automotive’s Driving the Digital Deal Study. Not to mention, that efficient technology-driven experiences in-store are a great recruitment tool for the younger, Millennial generation.

If all of this sounds great, then why aren’t more dealerships jumping on board?

Change is unknown. Change is scary. Change is hard.

So, what makes Omnichannel Retail successful? You do! Success needs a champion. If you are inspired and ready to champion the Omnichannel evolution in your store, here are 5 quick rules of the road to keep in mind:

1: BELIEVE

Ask yourself, “Do I fundamentally believe we will transact digitally in the future?“ Leaders who start with this conviction will be able to ride the wave of initial setbacks that may occur and ensure the team understands that this is the way of the future, if not the present. There is no turning back, but don’t expect 80 years of inertia to be overcome in a few short weeks. Lead with a strong vision and adjust course as needed.

2: HAVE A GAME PLAN

Change is hard, and while Omnichannel is the goal, you don’t need to rip the band-aid off all at once. Smart partners identify the department in their store that will be most successful at using the technology platform effectively. They pick a department as a beachhead, prove success and then expand the program from there. This could mean starting with the Internet/BDC teams who can move from static price quote responses to interactive deal sheets, or the sales floor team who can leverage the technology to do a needs assessment and deal presentation side by side with the customer. 

HINT: Don’t boil the ocean; rather start somewhere you feel has the best chance for success.

3: PRICE FAIRLY & CONSISTENTLY

If you are still insistent on pricing your new car inventory at MSRP, then Omnichannel Retail is going to be a struggle for you. Fair & consistent pricing breeds trust with customers. Nothing stops a customer faster in their tracks than if they feel like the price they are seeing is much higher than pricing they have seen elsewhere, or worse, is different than pricing they have already seen from you. Think about adjusting your pricing to maximize efficiency and customer experience as opposed to the current model of subsidizing your grinder deals with the occasional laydown deal. Put another way, don’t make all your customers suffer through a long sales process because you are looking for that occasional home run. There is a fair market price that can work well for both parties.

4: ENCOURAGE OWNERSHIP

Communicating early and often with your dealership personnel is imperative to getting the buy-in needed for success. Let staff have input into decisions, including the vendor selection process. They will feel more ownership. If they own it, you will be far less likely to start the initiative and flame out quickly. Weekly meetings with key stakeholders to help tweak processes and to maintain feelings of empowerment are key. The worst thing you can do is introduce your staff to the concept at the time of implementation and training. The communication must start well upstream of that.

5: RECAST ROLES

With any change, the first question that comes to everyone’s mind immediately is “how does this impact me?” If there is an inkling of doubt about the longevity of someone’s role, they can and likely will sabotage the change. So, before you make significant changes to your process, share your vision for how this change is going to make their position at the dealership even more valuable.

As business people, we all need to be thinking about the evolution of our customers and the changes required of our business to remain relevant. As an industry, we are in a unique position as we transition to time as the new currency. Time is something that both sides can benefit from in the long run.

Want to learn more? Request a full copy of our Omnichannel Commerce report by emailing insights@roadster.com.

It’s a New Year and everyone is buzzing about nascent trends that will go mainstream over the next 12 months. Nowhere is this more apparent than in the ever-evolving retail space. The important thing to remember is that the retail evolution is completely driven by consumer demand; Expectations from experiences in one category, translating to the next. So, it behooves us to look at macro trends and see how they apply to the industries we each live and breathe every day.

For me that means Automotive, so -- here are my predictions on how five trends touted by the retail experts at Daymon Worldwide & IDG will apply to the Automotive retail industry of 2017 and beyond.

1. ecommerce moves in-store

Digital retailing has been a buzzword in Automotive over the past several years. However, like most buzzwords, the definition has been hazy at best. For some it has meant vehicle merchandising, while for others it has meant online credit apps, calculators and F&I. Last year, this definition began to converge around ecommerce solutions that allow customers to desk their own deal. However, for most, the word “digital” still equates to online activity outside of the dealership itself.

Retail experts predict a transformation of the in-store experience in 2017. Retailers will need to focus more than ever on how their employees can leverage retail technology to enhance the customer experience.

Shoppers want tailored solutions that lead to experiences—not just transactions.

For automotive, this means putting tools at the fingertips of the sales agent and ultimately providing a seamless experience from online to offline and vice versa. Gone will be the days when a customer walks in and roams aimlessly around the lot. Dealership personnel will be empowered with tools to assist the customer in narrowing their options, even integrating all of the research and preparation the customer completed prior to arrival.

At Roadster, we now offer our dealer partners an in-store app to facilitate the transaction in concert with a white-labeled ecommerce solution. We have just added a Vehicle Recommender tool to the App that empowers showroom agents to help the consumer explore and assess vehicle alternatives that satisfy their needs on the path to finalizing the perfect deal structure.

2. Shoppers demand co-creation

Since the dawn of time, the vehicle transaction has been a black box for consumers. They want a fair price but have a hard time understanding if they got one, let alone deciphering the details of the deal.

Retail experts predict a move to co-creation of the retail experience:

Thanks to the digital revolution, shoppers are empowered to take things into their own hands, often times translating their frustrations into solutions.

This is by far, the biggest opportunity in automotive, where frustrations can be fairly high. By allowing a customer to co-create their own deal, automotive retailers can put the consumer at ease, make them feel in control of their own destiny, and by doing so, give them the space to digest the details of what is in front of them for a much more satisfying experience.

How much more satisfying? Dealers in the Roadster network who have embraced co-creation are seeing Net Promoter Scores in the 80-90 range. This is unprecedented for an industry that regularly generates scores in the 40s.

3. Convenience becomes table stakes

Let’s face it. If you were to rank the traditional car buying experience from 1-10 on convenience, most consumers would give it a -1 rating. Between the dreaded phone calls and 5-6 hours at the dealership, who can blame them? And to make things even worse, these frustrations grow as other retail experiences get easier. Startups have emerged to address this frustration-- trying to disintermediate the dealership model with the promise of convenience, but I believe dealerships are ready to embrace it themselves.

Why now? Because convenience for consumers means less time for dealership personnel too. In an industry with shrinking margins, this means embracing technology that makes your entire staff more efficient and therefore able to touch more customers. The challenge is that convenience means different things to different people and people expect what they want, when they want it.

Talk to five shoppers and you will likely get five different answers to what convenience means—and retailers are expected to keep up with all of them

Automotive retailers who adopt flexible systems to accommodate the needs of each customer will win. We have dealer partners already reporting an average of 3-6 hours of time saved per transaction… and this is just the beginning.

4. Technology fosters human connection

In a world where everyone walks around buried in their phone, it is refreshing to think that technology can play a role in humanizing the retail experience both online and in-store. With trends like chatbots and easy messaging systems ala Airbnb, retailers have more opportunities than ever to connect one-to-one with their customers; and not just company to customer, but person to person-- putting a face to retail employees.

What this means for automotive is that we will see a blending of automation and relationship. An experience where technology is used to provide the details and sales agents will participate as consultants. With 30% of dealers already using iPads in-store, it is easy to see how this trend quickly becomes a reality. Technology becomes a conversation enabler to customize the experience and close the deal.

5. Generalists emerge

Okay, perhaps this is my own prediction. But with all of the above at play, it is easy to see how technology enables retail personnel to handle a customer’s needs from soup to nuts. When all of the information is at your fingertips and even customers can desk their own deal online, breaking down silos and removing layers of approvals makes room for a much more efficient sales process. It also means that you now have even more people to touch your customers. Remember that NPS score I was talking about? Those who think outside the box will be rewarded.

In short, 2017 is shaping up to be a transformative year for automotive retailing. Not just because the macro retail predictions are gospel, but because the dealership community is ready for it. Do you agree?