The average consumer doesn’t understand the complex dynamics of the automotive industry. In fact, they probably don’t even care enough to learn about it. But these very dynamics are what greatly affect the availability, price and depreciation of vehicles.
Even though many consumers don’t understand these certain complexities, and claim to not care about them, they’re things that consumers care about a LOT.
Think about it. Let’s say a consumer visits your dealership and asks for a lower price on a vehicle. The dealer asks the consumer “Why?” and then the consumer doesn’t have a proper answer for them.
If that consumer happened to understand the complexities of calculating such a price, not only wouldn’t they feel the need to negotiate, but they’d feel more comfortable with the price as it’s likely the best possible calculation.
Back in the day (let’s say 10 or 15 years ago), it was almost to the dealer’s benefit to NOT have to explain the process of pricing to a consumer.
A consumer would visit a dealership, browse the selection at said dealership and take things at face value. If they didn’t like what they saw or researched, they’d leave or try to haggle. If haggling didn’t work (because of a lack of industry knowledge), then again, they’d take their business elsewhere.
Nowadays, however, consumers aren’t okay with being complacent and accepting things as they are. If they can’t get the information they’re looking for, or can’t get the deal they want, that relationship is over. In this tech-savvy age of smart-phones and micro-moments, consumers prefer to self-educate.
Before they make any purchasing decisions or even step foot into your showroom, consumers visit different dealership websites to look at inventory, pricing, financing options, trade appraisals, etc. Additionally, consumers like to take assessments (Ex: what vehicle or financing option is best for me?) and they prefer to read reviews of vehicles and dealerships before committing to anything. After all, purchasing a vehicle is a big decision.
Long story short: You can’t trick people anymore. Now, I’m not saying that your dealership has been tricking people intentionally -- but there’s no such thing as hiding information from car buyers anymore. To alleviate a lot of the conversational friction that stems from a consumer’s lack of education or independence, your dealership needs to provide resources that help improve self-efficiency.
What better way to provide those resources than to publish them on your dealership’s website? It’s your most powerful marketing platform! One of the most important things your dealership should do is educate car buyers about their vehicle of interest and your appraisal process.
Using images and video and other automotive solutions like assessments and calculators, your dealership can explain, at a high level, what the current process is for calculating best prices and determining fair vehicle appraisals. Images, video and interactive experiences have not only help consumers to stay actively engaged on your website, but it helps them retain information as well. Something as simple as a short, 1-minute video next to a specific inventory listing to explain went into calculating a specific price, provides them with the confidence to move further down the purchasing funnel.
In my last piece for DrivingSales, I mentioned that importance of branding your price in order to take responsibility for the information you’re providing to consumers. Educating your consumers about aspects of your dealership is really no different. If anything, the concept of branding your price was just one component of many regarding consumer education.
By taking the time to educate your customers, you decrease their need to ask numerous questions and haggle. If consumers have copious amount of information at their disposal, they won’t even have to speak to a sales rep until they’re basically ready to step into your showroom for a test drive. Even though the ultimate goal is for your sales reps to develop a strong relationship with their consumers, technology has made consumers desire a more independent research experience.
As much as dealers would like to resist the temptation to replace all of their old fashioned marketing and sales tactics online, now is not the time. Consumers will need your help at some point during the car-buying journey — but in early stages, it’s best to leave the information out and let them seek it out themselves. As soon as they find what they’re looking for, I almost guarantee that they’ll be back.