Dealership questions about digital retailing

What Is Automotive Digital Retailing & Why Does it Matter?

Written By Ted Rubin

What’s missing in automotive digital retailing?

That’s a question many of us in the automotive industry have investigated for years, particularly in 2020. I interviewed some car dealers and found five digital retailing questions and concerns frequently brought up during the discussion on my quest to find out. Misconceptions and misguided assumptions are the enemy of a proper process and can create barriers between your dealership, a digital retail platform, and online car buyers.

So, I’m sharing my findings with you in hopes that this article will help you combat that and prepare you for a successful automotive digital retailing experience at your dealership. We've outlined five frequently asked digital retailing questions and our responses.


Will the Digital Retailing Automotive Process Interfere with my In-Store Operation?

The truth is that, yes, automotive digital retailing can interfere with your dealership's in-store car buying process if you don't choose your tools wisely. Some common issues with digital retailers include:

"The deal doesn't go into my DMS."
"The customer doesn't know how to use the tool."
"I always have to rework the deal because the numbers are off."
"It's not actually retailing... it's just a tool for leads."

If you've found your dealership in any of these positions (especially in 2020), understand that you are not alone. The whole automotive industry was feeling the pain. However, it doesn't have to be that way — working twice as hard to make digital retailing work for your dealership.

The best automotive digital retailing platform will assist your in-store dealership sales team, not hinder it.

Find a digital retail product that helps your sales team make the most efficient use of their time by cutting down the processes needed to close the deal and sell cars faster.

When you're shopping around for automotive digital retailing platforms, ask this question. Knowing that your dealership sales team can focus on selling the vehicle rather than spend time navigating a lengthy deal-building process online will help you sleep better at night.

Don’t Customers Want to Negotiate the Price in Digital Retailing?

Price negotiations are often the most dreaded step for those looking to buy a vehicle at a dealership in the traditional car buying process.

We have found that most customers trying to purchase a car on websites don't want to go through the hassle. Understand that when it comes to online shopping, it's all about price comparison shopping and dealer vs. dealer savings for customers.

According to this Cox Automotive digital retailing article, a lot of consumer confusion related to price stems from automaker MAP restrictions in the auto industry, inaccurate customer financial data, and an overwhelming desire by the dealership to show only one payment – or none at all.


One of the great things about digital retail transparency is that customers perceive the price more accurately with a narrow negotiating window. 91% of U.S. customers would accept (or at least consider) an instant vehicle loan offer if it meant avoiding dealing with a bank or doing extra paperwork at the dealership. Good digital automotive retailers will help customers figure out monthly payments based on accurate lender rates, value their trade, then shop aftermarket items efficiently.

Customers will pay more for a car when there is a convenient online shopping experience.

Plus, online customers who prefer negotiating at the dealership can still have that option if you offer guided retailing with a live person to assist in the car sales process.

How Will The Customer Complete More Complex Digital Retailing Steps?

Many dealerships were forced to pivot into the digital age due to social distancing restrictions seemingly overnight. This rush to adapt has created a wide variety of self-service retailing tools in the automotive industry that aren't as user-friendly as we thought. Many dealerships still struggle to get retailing completion because of how steep the learning curve is.

Put your dealership customer front and center when you think of, develop, market, and launch your digital retailing process, with whatever digital retailing platform you choose. Look for features that make complicated steps easier for customers and ultimately turn leads into sales. Below are just a few examples:

Live Human Assistance

Professional live support that keeps the deal moving forward and offers insight when customers need it. They also help build trust and rapport so the customer can build lasting relationships with your dealership. And trust me, this industry needs all the help it can get with building trust.

When it comes down to it, people hate talking to a voice recording in a phone-based customer service situation. The sentiment is the same with live chat. People want to talk to a person.

When it comes to real-time support, you have options — voice, video, and the all-time favorite texting and chat.

Do you have any digital retailing questions regarding guided e-commerce? Ask the experts! Chat with us.

Customizable Workflows

Every deal is different, and every car buyer has unique needs. Having a rigid digital retailing tool with one chronological order isn't really how shoppers buy cars. Every car purchase journey is different.

It’s important to remove confusion and create a seamless experience for consumers by presenting specific car purchase workflows based on each individual.

User-Friendly Interface

The automotive digital retailing process is often presented in overwhelming ways to the buyer. Below, I've outlined some common customer experience issues in digital retailing that you may want to consider:

Decision-making criteria are unclear.

The kitchen sink approach gives online consumers too many choices and features, resulting in option paralysis and stress for your customer. Including too many options turns away leads and potential sales.

Your dealership's job is to make online car buying as easy and enjoyable for your customers as possible. Customers' purchase options on such a platform should be clear, concise, and streamlined.

Your website has too many distractions.

Every minute of our waking lives, we are bombarded by numerous stimuli. Good website design and marketing ensure that your customer experience is the best your brand has to offer without distraction or interruption.

The solution here is to minimize or eliminate friction so that leads turn into genuine interest which then turns into sales. This way, your customers will stay focused and achieve their goals and objectives with your business.

Your digital experience ignores user intent.

Good customer experience is all about the details. To exceed customer expectations, make sure your digital retailing tools anticipate their intent during every interaction and make your online car buying experience functional and relevant based on this understanding.

When reviewing your digital retailing solutions, ask yourself the following question:

Have you created a mobile experience that keeps car buyers' attention and meets their expectations? Or are you frustrating customers and giving them negative impressions of your dealership?

Do My Customers Have to Complete the Entire Process Online on a Digital Retailing Platform?


In an ideal world, you should be able to choose what's best for your dealership's business model. If the lockdown in 2020 taught us anything, it's to be adaptable to change. Find digital retailing solutions that are flexible enough that when you adjust for what’s next, so does the service. We understand that consumers want to do more of the transaction process online.

70% of automotive shoppers expect the ability to configure accurate payments from dealership websites. Shoppers still benefit from partial completion of the process when the next steps can be resumed in-store. This seamless connection from the online experience to the in-store experience is known as connected retailing, and it's this kind of frictionless dealership transaction that customers love and value.


Allow Customers To Do More in The Automotive Digital Retailing Process

But, maybe you want to allow the consumer to do more — value their trade, get a soft or hard credit pull, get a better idea of financing options, etc. As consumers continue to use automotive digital retailing online, they'll want to do more of these next steps online or through a mobile app, so consider giving them that power and a little more transparency!

Consumer behavior is evolving before our very eyes, and soon enough, buying vehicles online won't be a challenge; it'll be the norm. Technology is constantly evolving, and with services like Amazon, online shopping isn't going anywhere. It's important to find solutions that work for your dealership now and in the future.

How will Automotive Digital Retailing Affect my Finance & Insurance Profits?

This is one of the most asked digital retailing questions we've gotten this year.

Financing might generally be the biggest hurdle when it comes to selling vehicles. When it comes to online finance and insurance, we have often heard dealerships concerned about securing F&I managers' jobs and profitability. So they'd rather keep F&I in stores and as far from technology and the Internet as possible.

I will save my entire "F&I needs to be integrated into DR" spiel for another post entirely. Still, I will say this: when you make it hard for consumers to gain insight about F&I products before they come in-store, you always risk losing that revenue to the aftermarket competition.


How to enhance the vehicle buying process on your dealer website

First, look at your in-store sales process in the finance and insurance department right now. Could you make the experience easier and more convenient for consumers by utilizing technology features and allowing them to complete the finance and insurance steps online?

What about allowing them to complete the other steps online, so they only need to do the final steps in person? That can take a huge burden off of the customer in their personal journey and how they see the buying process with dealers overall.

Get a digital retailing product that fits your F&I department goals. If you find yourself needing to overhaul your financing department to match your DR tool, you may be biting off more than you can chew.


Digital Retailing Automotive is People & Technology Working Together

One of the biggest lessons in 2020 was that shoppers still want to purchase cars from people, even during a pandemic. Dealerships have done a fantastic job adapting to global retail changes quickly to earn a profit, and digital retailing is just one example of that. Now, it's vital to review the current, primary sales process data and find ways to take automotive digital retailing to the next level: one where both buyers and sellers succeed.


Ready to discover how ActivEngage helps your dealership succeed?