With the advent of e-commerce, retailing has changed in the way we buy almost everything, even our cars.
Many people research major and even minor purchases on their home computers and make comparisons between different brands, before deciding what to buy. Generally, they have a preference in mind when they begin the research and are mostly attempting to reaffirm their thinking.
This is especially true with cars. The manufacturers websites give them the ability to specify and “build” their desired vehicle - with the hope that it will lead the purchaser to request a brochure - requiring them to give their contact information and to visit a dealership and arrange a test drive - and hopefully buy the vehicle.
However, there is a long way between the home computer and the showroom floor.
It’s a given, that most people (at the moment) want to see, touch, hear and drive the real thing - and not just a computer simulation, before they make the logical/emotional commitment to buy.
Is this current retail model also the way of the future? Probably not, as retail trends change with every generational change.
Consider the following: Baby Boomers were born between 1944 an 1964, Generation X were born between 1965 and 1979. Generation Y were born between 1980 and 2002 (millennials) and Generation Z between 2003 and 2019. (US Census)
The world-wide-web became available in 1993 - which shows that two of these generations were born into the www. era. So, what we have are four generations of customers, who have four different aspirations and four different ways they interact with the buying of a product - including automobiles.
It is reasonable to believe that, not only is e-commerce here to stay and that e-pay from a phone or watch is beginning to take hold - especially with the Gen Y’s and and the Gen Z’s, but also the acceptance of e-commerce is still only in its early stage of development.
What does this mean regarding the future of new car retailing? How to convince potential customers to come to your showroom, after they leave their computers - and what do they expect to find there when they arrive?.
Let’s look at the two experiences, to see what common ground there is.
Home Computer / Mobile Phone
Instant information regarding all models, engines, colours, accessories etc. Able to specify the car to your liking. Able to rotate your build, to see how it looks all around. Sometimes, get a drive away price - but generally without the options you specified. Able to download and print the information as seen on a small screen.
In The Showroom
Real cars, but often not the exact model you are interested in. Often, not your preferred colour or specification. You do get the feel of the car “life size” and in the metal. You do get to sit in the car, get the new car smell, start the engine and hear how it sounds. However, mostly there is very little information, other than a small information panel next to the car, with the details of that vehicle - and an informed sales assistant who can answer your questions, regarding availability and cost of your preferred car, options and delivery times.
The two experiences are very different. The Boomers and Gen X’s are more or less happy with the current situation, as the web experience is a plus to the showroom experience they have had for most of their lives.
However, how about the next generation of customers - the Gen Y’s and Z’s? They are the ones who are driving the e-commerce change to the way we are buying goods and services now and more so in the future. Currently, there is too much missing from the e-commerce experience, to be satisfied with it alone.
Audi tackled this issue with their digital prototype car showroom in London which opened in 2012 and closed in 2018. Audi has now demonstrated the development of their digital software at the Singapore Motor Show in 2017 and 2018 which they stated would be rolled out to their dealers in 2019.
This will, in effect, allow the customer to do in the showroom on a 60” screen, what they can do on their home computer / laptop / phone and combine that experience, with the benefits of the “real car in showroom” and sales assistant experience.
So, is this the answer that all dealers should be looking for? In part -yes, but there needs to be more, as this covers the buying experience only, but doesn’t address the emotional aspect that is also generally, a prime consideration with purchasing an automobile.
The car showroom will need to become a lifestyle destination that among other things, also sells cars. A meeting place that also features other “car related” activities, that would be of interest to a potential buyer - it could be family related or motorsport related or both, depending on the marque.
There should be less emphasis on product, as that is already achieved by e-commerce and the sales assistant and more emphasis on experience - less showroom, more story and more social.
This can be achieved in both large and small showrooms in varying degrees, without needing to be a factory dealer showroom.
Robyn & Peter Rektor