Dealership questions about digital retailing

What Is Digital Retailing & Why does it Matter?

What’s missing in 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 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 retail experience. We've outlined five frequently asked digital retailing questions and our responses.

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Will the digital retail process interfere with my in-store operation?

The truth is that, yes, digital retailing can interfere with your dealership's in-store 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. However, it doesn't have to be that way — working twice as hard to make retailing work for your business.

The best digital retailing tools will assist your in-store team, not hinder it. Find a retailing product that helps your sales team make the most efficient use of their time by cutting down the processes needed to close the deal.

When you're shopping around for a digital retailing product, ask this question. Knowing that your team can focus on selling the vehicle rather than spend time navigating a lengthy deal-building process 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 in the buying journey. We have found that most consumers trying to purchase a car on websites don't want to go through the hassle. Understand that with online shopping, it's all about price comparison shopping and dealer vs. dealer savings.

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

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

People will pay more for a convenient online shopping experience.

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


How will shoppers complete the more complex online car buying 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 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 customers front and center when you think of, develop, market, and launch your digital retailing process. Look for features that make complicated steps easier for the consumer and ultimately turn leads into purchases. Below are just a few examples:

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Live Human Assistance

Professional live support that keeps the deal moving forward and offers insight when shoppers need it. They also help build trust and rapport to build lasting relationships. 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.

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

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User-Friendly Interface

The automotive digital retailing process is often presented in overwhelming ways. 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 users too many choices, 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 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 design and marketing ensure that your customers experience the best your brand has to offer without distraction or interruption. The solution here is to minimize or eliminate friction so leads turn into genuine interest. This way, your customers will stay focused and achieve their goals and objectives.

Your digital experience ignores user intent.

Good user experience is all about the details. To exceed your customer's 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 them and giving them negative impressions of your dealership?


Do my customers have to complete the entire process online?

No. In an ideal world, you should be able to choose what's best for your dealership's business model. If 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 buying 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.

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But, maybe you want to allow the consumer to do more — value their trade, get a soft or hard credit pull, etc. As consumers continue to use automotive digital retailing, they'll want to do more of these next steps online or through a mobile app. Revolve, for example, allows your dealership to create custom workflows so your online buyers can do as much or as little of the buying process as you allow!

Consumer behavior is evolving before our very eyes, and soon enough, buying a car 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 you now and in the future.


How will digital retailing affect my finance & insurance profits?

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

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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.

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

When ActivEngage first launched Revolve, we knew from the getgo that we wanted a retailing service that worked in tandem with the F&I department. That's why, unlike other products, F&I profits are never sacrificed with Revolve. With signature-ready deals, shoppers can upsell themselves with service contracts, gap insurance, etc. Or your F&I Manager can use Revolve in-store (with your banks) to complete the final buying steps in person.

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The Sweet Spot: People & Technology Working Together

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