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Are you future-proofing your business so you’re equipped to succeed now and in the future?
Consumers will continue to drive change as they spend more time online, and with that comes a thirst for information, convenience and ease. Today, consumers spend twice as long researching online for their next car as they do offline (10.8 hours over 5.8 hours), and this trend is set to increase. So whilst we believe there will always be a place for physical forecourts, their role will evolve as consumer expectations change.
Our recent Annual Buying Behaviour Report, which surveyed over 2,000 car buyers showed that 74% of buyers research their next car online and a third discount dealerships as part of their research entirely, choosing to research online so when they do turn up to the forecourt they’re ready to buy. If this trend continues, it’s going to mean that retailers will need to adopt new business practices and models to ensure they are equipped to embrace the changes.
But with change comes opportunity. Retailers in other sectors embrace consumer change, and build their business models with the flexibility to adapt to changes in the future. Tesco, Amazon and John Lewis stock desirable products for consumers wherever they may be, and naturally optimise between the rate of margin they make and the speed of sale. Their strategies are centred on turning stock quickly to make money – something automotive retailers are increasingly focused on.
How do you turn stock quickly? By holding desirable stock and using valuable data to identify which cars are in demand in a certain area. Data can also help set prices so cars are competitive within the market, meaning they will rank highly in a consumer’s search.
It’s not just stocking models that these retail giants have mastered. They know that providing a transparent and trusted platform will help them connect with consumers too.
Transparency is the number one driver of trust and retailers who embrace transparency will be more successful. Just as Amazon and Trip Advisor have done, automotive retailers will need to encourage a transparent retailing experience where consumer reviews and ratings feature highly and transparency of pricing, customer service and business practice becomes the norm.
At the point at which a consumer visits a retailer’s forecourt, the offline experience, retailers need to ensure this process is seamless and easy to maximise their chances of securing a sale. That means gearing the business to being able to sell a car there and then, as it’s likely that once someone steps onto your forecourt they are ready to buy.
Our research shows nearly three-quarters of consumers will be looking to test drive or buy there and then at the showroom, so being equipped to meet these needs will be imperative to close the sale.
Retailers also need to ensure they are providing a customer experience that meets and exceeds the consumer’s expectations. Our research revealed the third reason given by a consumer for why they bought from the retailer they did was its friendly and courteous staff. Retailers who get this right build loyalty and repeat business.
With consumers looking for a smooth and stress-free buying experience both online and offline, there is a tremendous opportunity for the industry to seize.
For more information visit trade.autotrader.co.uk/future