Customers are becoming incredibly sophisticated, elusive, and empowered since the latest digital retail wave. As a result, the dynamics of the relationship between brands and customers is evolving. But even in this new digital era of online engagement and transparency, the reality is that the relationship dealers should hope to have with customers through these new digital channels, and their true state is not one in the same. Dealers can underestimate the significance of customer experience. Rather than examine the role new technologies and tools can play in improving customer relationships and experiences, many dealers focus on establishing a digital presence but not by defining meaningful experiences or outcomes.

A heavier reliance on shopping and purchasing online has changed how consumers discover and share information and has placed more importance on connecting with each other. Customers don’t look to dealer websites for “Why Buy From Us” info but instead they are looking at what others are saying about both the dealership and the vehicle. Technology aside, COVID - 19 has driven the rapid adoption of digital retailing technology based on both need and convenience.

As digital technology matures beyond a luxury into everyday life, consumer expectations only grow. As a result, functionality, human involvement, and experiences have become more important for shoppers than pricing and availability which can look the same to them from dealer to dealer. Staying ahead of the competition takes something greater than mere presence in the right channels. Customer experience has become a critical point in customer engagement in order to compete for attention now and in the future. Without a thoughtful and well-defined guided digital retailing customer experience, consumers will meander without direction, reward, or utility.

The crux of customer experience for dealers is intention and purpose. Some dealers are offering tools because they know customers want them but show little regard for their functionality. Customer experience is the new blueprint for most new media deployments. Digital experiential strategies form the bridge where intentions meet outcomes. By starting with the end in mind, customer experience technology adoptions provide efficiency and enchantment which delivers more meaningful, engaging, and rewarding customer journeys.

It’s easier said than done. Customer experience initiatives are a science and an art, and they should never be ignored in the development of digital channels that drive customer engagement. When an experience does not deliver value, customers can and will effortlessly move on. A dealer coming off as gimmicky without intent will drive customers away and ROI will escape their grasp.

Often, creative strategies are driven by clever ideas and not necessarily ones that are focused on engagement or experience. Experiences and outcomes should be looked at as a cohesive and symbiotic strategy. Sharks and Remoras are a great example. The shark can live without the Remora. The Remora helps the shark – and the shark doesn’t mind - because they both benefit. When ideas are deployed without direction, everything that results is almost entirely accidental while it is easier and more effective to be purposeful. Disney knows this which is why they operate under the theory of “intentional design,” something nature always has just by… well… it’s nature.

Some dealers are guilty of deploying technology without considering a holistic experience such as installing high funnel conversion CTAs for consumers with canned responses instead of real answers to pricing, financing and trade evaluation inquiries.

The goal of a great customer experience by dealers should be providing digital tools that create a delightful, emotional, and satisfying experience. This is why it’s critical to customer experiences and engagement. Customer experience is supposed to be experiential, informative, useful and productive, but most importantly, it’s deployed with an end in mind where the means to that end is engagement, conversion and, ultimately, a transaction. A successful customer experience strategy will evoke engagement with purpose, affect sentiment, and influence customer behavior.

User Experience, by definition, addresses all aspects of an experience within automotive shopping, purchasing and owning of a vehicle from the customer's perspective. From interacting with an ad, to interacting with a website and to parking their new vehicle in their driveway, user experience guides the interaction of the customer throughout mobile apps and websites from both visual and functional perspectives. It encompasses the experiential, affective, meaningful and valuable aspects of human-business interaction and product ownership and use. Here are 5 reasons why User Experience is the foundation of a successful dealership.

1. Stronger Customer Loyalty

To put it simply, if users have a negative experience with a digital retailing feature on a dealership’s website or mobile application, they are not coming back. Dealerships really only get one shot. Not only do dealerships lose a potential customer, they are also sending them directly to a competitor. Almost every consumer chooses to do business with a competitor after a poor customer experience.

Loyal customers also make some of the best brand ambassadors. Referrals are the least expensive customer acquisition but also come with higher closing rates. A positive user experience will help dealerships get to that point. Loyal customers account for roughly 20% of a dealership’s customer base, but make up more than 65% percent of its sales.

2. Stronger ROI

With better user experience, dealers get enjoy a better return on investment across all operations. It guarantees that money invested into its software solutions and marketing efforts generates into a measurable value. This results in stronger customer retention and it costs 3 to 5 times more to acquire a new customer than to retain a returning customer.

3. Stronger Conversion

Measuring the effectiveness of your user experience efforts depends on how many users you turn into customers. Analyzing conversion rates is far more effective in measuring user experience than using sales figures alone. 74% of businesses believe User Experience is the key to increase the rate of conversion.

4. Stronger Productivity More Efficiency

By helping users get information and provide easy to use shopping tools, dealerships let them know that they respect the consumer’s time and appreciate their business. Every interaction between the customer and a dealer’s website should happen in the fewest possible steps with the least friction possible. Evaluating a trade has been historically time-consuming for both the customer and the dealership – especially when the interaction and transaction is occurring online in a digital retailing capacity. Finding every little scratch and dent to fill in a vehicle inspection form takes time and attention to detail. Dealerships are hesitant to give solid numbers on a sight-unseen trade-in while consumers want hard numbers before coming in. The faster, simpler and more accurate it is to use a digital retail feature, the more likely it is that consumers will complete the process and the more confident a dealership will be in giving a more accurate value.

5. Stronger Customer Experience and Satisfaction

A dealership’s customers are the users of digital retailing software and they are valuable. When the process is easy, pleasant and natural for customers to be able to complete the steps in a digital retailing process, they are more likely to complete a transaction with the dealership. These benefit both the consumer and the dealership and lead to a better customer experience for the consumer and an easier sale for the dealership.

It goes without saying that User Experience (UX) is heavily dependent on the design of an application, integration of a dealership’s brand, and being able to provide the tools and information consumers are looking for while shopping for a vehicle. When 62% of shoppers and consumers base future purchases dependent on past experience, the user experience circumscribes customer loyalty and retention.

To make a long story short, user experience should be more than just an afterthought and can affect revenue from many angles. A dealership’s customers expect to be able to engage with them on their terms. Making that process easier will only make the dealership stronger. And that is what leads to increased revenue, retention and loyalty.