Mixed signals

Posted by

While customers might say they want more online communication, that’s not what they are doing. How should dealers respond?

PulseColumn_365179238We’ve been hearing a lot over the past few years about how important digital communication is in the car buying process and how critical it is for dealerships to invest
in and develop digital communication, sales and marketing strategies. 

We’ve heard a lot about the digital storefront, and there are countless products that help manage customers and prospects via digital media.  I fully subscribe to the notion that this is a reality in the current environment and that any business that ignores the trend will be left behind. 

But there is another side to the story.  Consumers are still telling us that, despite all of the digital resources they tap into and the tools available to them, they often default to the personal touch when they’re ready to make major decisions.

It’s not a situation of one or the other, but is really about how both sides should and can be managed.

What they say and what they do

Recently, I’ve been analyzing some data about how customers want to interact with their dealerships. 

It started with the 2015 J.D. Power CSI study, which showed that, while around 20 per cent of customers said they would prefer to schedule a service visit online, less than 10 per cent on average actually do that. 

That is reflected in other data that I have seen across different OEMs. At least seven out of 10 customers still schedule a service visit by phone and only about one in 10 use an online tool.  This is despite the existence of online scheduling tools made available by most dealerships. 

Online service scheduling is a cultural change, not only for the dealership, but also for the customer.  In addition, many of the tools are not really helpful. 

When the customer arrives at the dealership and finds the appointment did not make it into the system or all the information they provided is not available to the service advisor, he or she probably decides to revert to the old way and uses the phone next time.  No surprise that uptake of online service scheduling is progressing more slowly than one would have expected. 

But this will change as systems get better and as younger customers begin to make their presence felt.

As well, I’ve been looking at how customers make their first contact with a dealership when they buy or lease a vehicle, the result of which are displayed in the chart above. 

At first, I was surprised.  I would have expected to see more than 15 per cent of customers using online communication.  It appears that, in most cases, initial contact with the dealership still
happens when the customer walks through your door.

Is all the talk about digital communication overblown?  Are we wasting time and money with so much focus on digital communication for less than 20 per cent of customers? 

While the shift to digital over the last two years has not been dramatic, I believe it will accelerate in the coming years. 

This is also just the tip of the iceberg.  The question relates specifically to the customer’s first contact with the dealership.  The customer has likely spent weeks (or months) researching new vehicles, checking dealer inventory, checking social media and comparing dealer and OEM offerings.

Most consumers don’t feel the need to have a long conversation with the dealership.  When they are ready to make their decision, they will appear at your door with a lot of their questions answered.

The car buying journey

There have been many articles and papers written about how the purchase funnel has changed and how consumers move through the funnel.  There are complicated diagrams and depictions of the different factors at play. 

I prefer a simple approach and I found this, not surprisingly, on Google website, Think with Google.

If you look at these questions, it’s clear that the answers are available to potential buyers from multiple online sources.  We may not agree that all the answers will be correct or that all the information is there, but consumers place a great deal of faith in what they see online —  especially when it comes to the opinions of other consumers. 

So, if they feel they have all the information, it’s no real surprise that for many, the first contact with the dealership is when they walk in the door.  And this is where the “touch” component comes in. 

While it’s vital for all businesses to invest in digital capabilities and keep up with their customers’ digital preferences, there’s a clear need for a balance. 

We can’t forget the fact that more customers still make their first contact with you in person.  Are we still paying enough attention to that?

Comments are closed.

Canadian auto dealer