Over the past 13 years our business (Anchor Vans) has transformed from a small local dealership into the UK’s largest independent van hypermarket, now servicing, selling and delivering vehicles to all corners of the UK and beyond.
The used car market has undergone dramatic changes in the last 25 years due to a shift in consumer behaviour and expectation resulting from significant technological advances.
Buying a vehicle used to consist of scouring the local papers, driving to dealerships, test driving, negotiating and applying for finance. A time consuming, costly and sometimes torturous exercise, whether purchasing a family car or a commercial vehicle.
The advent of the internet and subsequent growth of online advertising has revolutionised the vehicle buying process into the predominantly armchair-based experience we know today.
In the early days of the internet, dealership websites mirrored paper-based advertising with static pages and limited, often out of date listings.
Tech advances online have allowed businesses to display unlimited amounts of product information.
Furthermore, advances in search and database technology have ensured that these extensive product listings can quickly and easily be filtered down into those relevant to the individual customer.
Originally, the used car hypermarket came about to solve the problem of customers trawling multiple dealerships to find the right vehicle.
Once the customer arrives onsite, there is no need for them to leave until a sale is agreed.
At the same time, large motor trade advertisers began to embrace technology to get their products in front of customers. With online capabilities allowing for unlimited amounts of product data and effective filtering systems, this helped redress the balance between the small dealership and larger hypermarket.
Back to the present day, the internet is responsible for a huge shift in the way we sell.
For most potential buyers their first port of call will be Google. Buyers are now able to access a great wealth of vehicle information with just a few clicks.
It is estimated that prior to purchase more than 80% of customers will visit a ‘mobile showroom’ i.e. advertising or dealership sites on their mobile phone, where detailed descriptions, photos and even video footage is to hand.
Before these technological advances, scant information was readily available for vehicle buyers. A concerted effort would be made to trawl printed material or gain recommendations from friends. Now with extensive vehicle information online, we have also seen the rise of customer willingness to buy ‘unseen’ over the phone.
Most of us shop online regularly, making purchases without seeing products before we buy and buyer confidence is extending to larger investment purchases such as vehicles. Just like the large online distributors, the vehicle hypermarket benefits from the cost advantages of scale and holding stock in one large central location.
As technological advances soar so do customer expectations. They want fast access to services and products. Real-time stock info. Hassle free finance. Next day delivery – we get it on books and clothes, why not cars?
Fulfilling expectations is crucial in any industry, and we are increasingly meeting demands that would have been laughed at 30 years ago.
Of course, the ‘tyre kicker’ still exists, and whilst commercial vehicle buyers are more likely to purchase unseen, many car buyers still like a test drive.
The difference is that now that customers have narrowed down the options before arriving onsite, they know what they want and are ready to buy.
And with the increased online marketplace comes the important question of trust.
Trust between customer and car industry has been a notoriously rocky relationship for decades.
Before choosing what to buy, many customers will first decide who to buy from.
As old as human communication itself, word of mouth marketing has always existed. Now it exists online too, and is far wider reaching.
Customer reviews online make a significant difference to purchasing decisions, and research shows that 85% of buyers now trust online reviews as much as personal recommendation.
With the growth of online review centres and social media commenting, a retailer really has nowhere to hide, certainly a comfort for a hesitant buyer.
Excitingly, we have now reached a time where the purchasing experience can often be better online than when visiting in person.
Time is of the essence, everybody is busy, and everyone wants an easier life. Amazon aims to satisfy this need for its customers just as we aim to for ours.
Keep making leaps
The industry has made great leaps over the past three decades. As long as online communications continue to speed ahead, so too will customer expectations.
As online services for buyers develop and improve, the buying process will become easier yet. Buyers will be inclined to visit dealerships in person less and less.
Click and collect and home delivery will apply to cars and vans just as much as it does to your grocery shopping. It is up to us to keep pace with the technology and customer expectations.
In the long term however, there are bigger changes afoot. Electric vehicles are already on our roads and the introduction of self-driving vehicles is a speck on the horizon. There is no question that the next 30 years will see radical transformation of the car industry.
The market is ever-changing, keeping ahead of the curve is our perpetual challenge.
Author: Simon Joyce, managing director, Anchor Vans