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