Dealers: Internet Be Damned, People Still Want to Buy Cars in Person
Online retail has been laying waste to bricks-as well as-mortar shops of all varieties. Widespread cutbacks as well as closures of store chains such as Macy’s as well as Borders underscore which consumers certainly don’t mind having a blouse or a book delivered to their doorsteps with the click of a mouse. Those items often show up at reduced prices, too. For some consumers in sprawling suburbs, where navigating boulevards lined with strip malls can be a chore, internet shopping has been a godsend. So, where does the rise of online retail leave sales of cars as well as trucks, or more specifically, the physical dealerships, which are just bricks-as well as-mortar car stores?
At the 2017 National Automobile Dealers Association (NADA) convention in brand new Orleans, some speakers forecast a looming online car-sales boom. Mark O’Neil, chief operating officer of e-commerce as well as marketing firm Cox Automotive, told attendees at Automotive News‘ retail forum which 10 percent of all vehicle sales could be completely online by 2019. He said online retail could become a disruptive force from the automotive market similar to the way Uber as well as Airbnb have upended the taxi as well as hotel industries. He also said, however, which the owners of dealerships could not have to worry as long as they adapt as well as invest in their online offerings, Automotive News reported.
Going the Way of the Horse-Drawn Carriage?
Ford president as well as CEO Mark Fields appeared to be alluding at least partly to online disruption, if not to Tesla’s vertically integrated product of direct factory-to-consumer sales, when he told dealers at the NADA convention which he has heard rumblings which the franchised-dealer product could become obsolete.
nevertheless unsurprisingly, Fields added: “I want to say unequivocally which Ford firmly believes in This kind of franchise product. We believe dealers are an essential part of our industry’s as well as company’s future.”
Ford, for its part, has previously acknowledged which not everyone likes spending time at dealerships as well as is actually trying to give car shoppers more online options for the buying process. The automaker announced last month which the idea is actually partnering with AutoFi to let shoppers apply for credit as well as buy or finance vehicles through dealer websites. The move comes after Ford commissioned a Harris poll of 1000 American adults which found 83 percent could prefer to spend as little time as possible at a dealership when buying a brand new car or truck. However, many of those same respondents also said which they could like to be able to touch as well as feel a brand new vehicle before buying one.
A Ceiling to the Sales Boom
Another survey, done by eBay Motors in 2013, showed which only 13 percent of millennials said which visiting a dealership could be their preferred method of car shopping or researching an automotive purchase. Among shoppers over 35 from the survey of 1028 adults between ages 18 as well as 60, 51 percent said they could still prefer to visit a bricks-as well as-mortar dealership. Only one in a few millennials, though, said they could consider actually purchasing a vehicle using a smartphone, tablet, or different mobile device.
“I definitely see the idea shooting higher,” Clayton Stanfield, senior manager of dealer relations for eBay Motors, said of online sales. Even using a purchase as complex as well as hefty as an automobile, some buyers can know certain cars or trucks well enough to buy them without feeling compelled to see one first. “I’ve had a few Volvo XCs,” Stanfield said. “I don’t need to drive which car to know what the idea’s like.”
nevertheless Stanfield said he also sees a ceiling to any potential online-buying boom. He said he doesn’t think a large majority—say, 70 percent—of car buyers will complete a purchase online, because most people will still want to kick the tires of a prospective brand new car or truck in person.
You Can Play Mario Kart Online, nevertheless is actually the idea definitely the Same?
Despite the signs which people don’t like visiting dealerships, Beau Boeckmann, president of Galpin Motors, is actually not convinced which the experience at a physical car store has to have unpleasant associations on par with going to the dentist. the idea’s why Galpin Motors has installed video games such as Mario Kart inside kids’ play areas, for example. Galpin has been pioneering for a while, starting with being the first to open a full-service eatery in a dealership—the Horseless Carriage Restaurant, in 1966—as well as more recently replacing the typical dealership coffee station using a full Starbucks store.
“We try to make the idea a whole fun experience for people to be there,” Boeckmann said of the group’s Los Angeles–area dealerships, which sell a dozen automotive brands through eight retail stores. the idea seems to work: Galpin Motors claims to be the top-volume Ford seller from the planet.
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“You can buy shoes online, or a suit online, as well as if you don’t like the idea, send the idea back,” Boeckmann said. “A car is actually different. the idea’s personal. The actual driving experience is actually a personal one.” He likens actually closing the deal on an automobile online to finding a spouse over the internet. Some couples may meet which way, nevertheless most people wouldn’t go to a cyber altar to exchange web vows having never spent time together in person. “Getting a brand new car is actually no different,” Boeckmann said. “the idea’s a relationship.”