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Technology investment 'a threat' to profitability, says dealer survey

A third of car dealers believe the cost of technology investment is a threat to their business’s future growth and profitability, according to new research from Santander Consumer Finance.

Car dealers are becoming increasingly concerned about the need to invest in technology to maintain growth in their business, according to the results of the survey carried out by independent researchers Pollright, which revealed that the launch of ‘click to buy’ websites by manufacturers was seen as a growing threat by 32% of respondents.

Nearly two out of five car owners want to be able to buy direct from manufacturers, however, with 38% of more than 1,000 respondents stating that want to be able to buy directly from car manufacturers while a quarter (24%) would like to be able to buy their next car online.

Andy Green, director of marketing and innovation at Santander Consumer Finance, said: “Technology is driving structural change across the motor industry and dealers have to work hard to provide the service and connectivity that car buyers expect which means being on top of technological change.”

Santander Consumer Finance’s research showed that dealers do provide real value, with 64% of buyers stating that the service they received from dealers was very good when they last bought.

But dealers admitted they need to do more to strengthen their relationship with customers. More than half (55%) believe rivals have better customer contact strategies.

Green said: “Dealers clearly already provide an excellent service with around two out of three buyers leaving showrooms happy with the customer service they have received.

“But dealers also need support from partners such as finance providers to ensure they can continue to offer the service customers expect.

“We believe there is an enormous opportunity to help our dealers prosper and deliver mutual sales growth by investing in technology and are committed to supporting dealers and customers in enhancing the car buying process.”

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  • Lee Webster - 15/09/2017 10:08

    Dealers struggle compiling a technology strategy, which is now becoming vital in today's market. However, it doesn't need to be expensive or disruptive, just joined up.