You’ve invested plenty of time and resources into your marketing campaign. Now that new customers are beginning to show up on your lot, do you know what buying experience they expect? What is the best way you can help them find the vehicle that suits their needs?
With the internet buying information readily available today, customers are more educated than ever. There’s also a stronger emphasis on flexibility and convenience. These key factors cause customer tastes to change on an ever-evolving basis. Because of this, successful dealerships need to regularly evaluate and adjust their approaches to operations, marketing and customer service.
The best way to keep up with the changing market is by studying consumer data and industry stats. Every year, Cox Automotive conducts thorough research on the automotive industry and changing customer tastes within the industry. Here, you’ll get a summary of what customers look for in their buying experience. You’ll also learn how current buyers navigate the buyer journey.
1. The Focus on Used Vehicles
In recent years, new vehicle monthly payments have increased at almost double the pace of used car payments. This statistic alone makes buying a used vehicle more attractive to frugal consumers.
In a Cox survey of more than 3,000 consumers, 64% said they would choose to purchase a used vehicle over a new vehicle. This is a statistic that every dealer needs to pay close attention to.
With the skyrocketing costs of new vehicles, and shifting customer preferences to buy used, dealers need to make inventory adjustments. Over the next few years, put more focus on newer car model trade-ins. It’s also important to put the branding and selling of used cars on the top of your marketing strategy.
2. Third-Party Websites Are a Must
Customers are using the internet to research vehicles more than ever. In 2017, 57% reported that they did internet research on vehicles before making a purchase. That number jumped to 61% in 2018. You can expect the 2019 numbers to increase yet again.
When customers research vehicles online, they gravitate toward third-party websites.
Why They Matter
Cox research shows that 80% of buyers visit a third-party site before making a purchase decision. These sites are also highly influential in bringing customer traffic to local dealerships.
Because of this, it’s not enough for modern dealers to focus only on their proprietary websites. It’s vital to become a regular inventory contributor on third-party sites such as:
Posting current inventory on these sites will help your dealership find new customers that are in the market to buy. It’ll also keep rotating your inventory so there’s always something new to post.
3. Your Site Matters
Even with the popularity of third-party sites, customers still rely on OEM and dealership sites when it’s time to make a purchase. Cox research shows that customers gravitate toward third-party sites to acquire unbiased reviews of vehicles. Once a customer decides on the vehicle they want to buy, they typically head to a dealership site.
These same customers browse OEM sites when they are looking for specific incentives, features and offers.
Once you understand customer internet browsing data, you can focus on putting relevant information in the best areas of the web. Always keep in mind that customers typically begin their purchase journey on third-party sites, then head to your site when they find what they’re looking to buy.
As an innovator in the market, put tracking methods in place so you gain a better understanding of where your leads come from.
4. Vehicle Specifications
Cox research shows that customers pay the closest attention to vehicle specifications when they decide to purchase a new vehicle. In fact, 38% said it’s their most important factor when making a buying decision. The next most important factor is the manufacturer’s reputation, at 28%. Buying deals comes in third, at 22%. This means that specifications are king. A customer will choose their preferred specifications even over the price of a new vehicle.
This does not hold true for used vehicles. In the used market, price sways buying decisions more than specifications. This is likely because a new car buyer isn’t as sensitive to the ever-increasing costs of buying new. However, a used car buyer is more likely to seek out the best deal they can find.
If you’re looking to move more new vehicles, focus on personalization, customization and technological features that are important to these buyers. Put price discussions further down the sales channel. For many new car buyers, the price factor is secondary.
5. Negotiation and Paperwork Process
For many years, customers have expressed major concerns about the F&I process when they buy a new vehicle. The current Cox Automotive survey shows that this concern remains valid.
In fact, 29% of buyers listed the paperwork and contract process as the top frustration they experience in the buying process. The second major source of frustration is negotiating a final price. Nearly 28% of buyers listed this as their most frustrating buying experience.
Most dealerships seek to do price negotiations and contracts face-to-face. There’s nothing wrong with this practice. However, there are ways to make the process more customer-focused.
Use the Power of Your Website
On your website, employ a section that allows customers to get pre-approved for their loan before they come into the showroom. Have your staff enter all contact information into contracts before the customer arrives. You may even want to implement a pricing model on your site that reduces the time it takes to negotiate a final price.
These small changes are a win-win for your customers and your business. They give your customers a better, more efficient buying experience. They’ll also allow the dealership to service more customers in far less time.
Dealership Marketing That’s Customer-Centric
As time goes on, the desires of customers will continue to grow and evolve. Technology plays a major role in this evolution. This most recent study conducted by Cox Automotive provides dealers informative insights into the car buyer journey. Use this information to create marketing and sales strategies that will continue to meet your customer’s demands.