In today’s automotive landscape, having a robust online platform is no longer just a competitive advantage—it’s a necessity. Dealerships that have embraced digital retailing are not only meeting customer expectations but also driving significant sales growth. As consumer behavior shifts towards online transactions, dealerships must adapt to remain relevant and competitive. This article will explore the key aspects of digital retailing, its benefits, and how your dealership can implement it effectively.
Overview of Article:
- Defining Digital Retail
- Why Digital Retail Is Essential
- Why Customers Want Digital Retail Experiences
- Benefits to Dealerships
- Choosing a Digital Retailing Platform
- Getting Set Up
Defining Digital Retail
Digital retail goes beyond simply having a dealership website. While a website provides basic information and may capture leads, digital retailing enables customers to complete significant parts of the buying process online. This includes exploring inventory, configuring vehicle options, valuing a trade, applying for financing, and sometimes, even finalizing the purchase—all from the comfort of their home.
The seamless, interactive experience needs to differ from a traditional dealer website, which might only offer a basic overview of inventory and a contact form. A digital retailing solution gives online shoppers transparency into the details and cost of a vehicle that a shopper wants to know before making a purchase decision. Digital retail is a complimentary tool for both the customer and the dealership to make the retailing of a vehicle simpler and more efficient.
Digital Retailing Is Essential
The rise of digital retailing is undeniable. More dealerships are adopting these platforms to meet the growing demand from consumers who want the convenience of online shopping. According to a study by Cox Automotive, 64% of car buyers want to do more of the purchase process online than they did in the past, and 76% of dealers recognize that their dealership needs to evolve to accommodate these changing consumer preferences. What’s more, ShiftDigital found after measuring 80,000 leads across 16,000 dealership websites that website leads were down 30% year-over-year (YOY) while digital retail leads were up 28%. CarNow data also found that from 2022 to 2023, digital retail leads for CarNow dealerships rose by 85%.
Applying a digital retail solution isn’t just about keeping up with trends—it’s about staying competitive. Dealerships that do not offer digital retailing risk falling behind as more consumers expect and demand the ability to complete transactions online. In an industry where customer experience is paramount, offering digital retailing can be the difference between winning and losing a sale.
Why Customers Want Digital Retail Experiences
Customers are increasingly drawn to digital retailing because it offers several key advantages:
- Customers are In Control: Many customers like to have more control and transparency into the steps of the buying journey. They want to be able to shop when they want, in ways they want, and at a pace they want. Also, with affordability and transparency as a driving factor of what dealership a customer wants to work with, digital retail gives them the tools that lets them see their payment earlier in the buying process. (See graphic below to find out what customers are prioritizing during their shopping journey).Â
- Research First, Then Visit in Person: Consumers spend considerable time researching online before making a purchase. Digital retailing allows them to explore their options thoroughly, compare models, and even get pre-approved for financing. When they finally visit the dealership, they are informed and ready to make a decision, making the in-store experience more efficient. Â
- Available 24/7: Unlike traditional dealership hours, digital retailing platforms are available around the clock. This 24/7 accessibility allows customers to shop whenever it’s convenient for them, whether it’s late at night or early in the morning, increasing the likelihood of a sale.Â
Benefits to DealershipsÂ
Implementing a digital retailing platform offers numerous advantages for dealerships:
- Informed Customers Ready to Buy: Customers who use digital retail platforms arrive at the dealership better informed and closer to making a purchase. This reduces the need for lengthy negotiations and increases the likelihood of closing the sale quickly.Â
- Better Qualified In-Store Leads: Digital retailing helps dealerships identify and prioritize high-quality leads. By tracking customer interactions on the platform, dealerships can focus on those who are most likely to convert.Â
- Increase in Add-On Features and Services: Digital retail platforms often include options for customers to explore add-on features, accessories, and services during the purchasing process. This can lead to increased sales of these profitable extras.Â
- Reach a Wider Range of Customers: Digital retailing allows dealerships to extend their reach beyond their local area. Customers from different regions can explore and purchase vehicles, expanding the dealership’s market.Â
- Gain Better Customer Insights/Data: Digital retail platforms provide valuable data on customer preferences, behavior, and trends. This information can help dealerships refine their marketing strategies, optimize inventory, and improve overall sales processes.Â
Choosing a Digital Retailing Platform
Selecting the right digital retailing platform is crucial for ensuring your dealership sees the results it wants to see. The platform should ensure a smooth transition from one step to the next, without requiring customers to re-enter information or fill out lead forms multiple times. It’s essential that the platform delivers value upfront—such as providing a trade-in estimate or pre-approval for financing—before asking for more customer details.
Moreover, integrating a chat function within the digital retail experience can significantly enhance customer satisfaction. Providing real-time assistance during the buying process reduces bounce rates and helps keep potential buyers engaged.
CarNow builds its Digital Retail solution and features with the goals of our dealerships top of mind. But we also build our tools in ways we know consumers will WANT to use and engage with them. This is why our platform will regularly perform as a top vendor for generating conversions and grosses.
Our solutions aren’t meant to JUST improve your leads, they’re meant to improve the connection and quality between you and your customer. And as seen in the graphic above, we’re regularly in one of the top three spots for lead generation, but more regularly (and more importantly) in the top spot for closing deals.
Getting Set Up
Successfully implementing digital retailing requires more than just technology—it requires a well-planned strategy and support. At CarNow, we ensure our teams are equipped with an in-market rep to onboard, launch and further support you and your dealership. We also provide best practice guides and cheat sheets so your sales teams can understand how to best use the new tools to complement their sales process. This ensures the investment dealership leadership makes on technology is not only utilized but performs at its highest and with its intended purpose.
If you don’t have a digital retail solution, or have one that isn’t connected and helping drive more leads with more set appointments that lead to more closes, talk to us today and we can help you onboard a platform that makes the lives at your dealership easier.