Auto dealerships need online strategy

US car dealerships need to continue to evolve to keep up with consumer demands in an increasingly competitive marketplace, with more online resources, according to research from Cox Automotive, the company behind car search site Autotrader.com.

Autotrader.com’s survey of some 4,000 US consumers found the majority are generally dissatisfied with the car buying process and dealers need to do more to meet their expectations.

Just a handful (17%) of those a polled like the current car buying process, with suggestions for improvement including test drives from product specialists, not salespeople, as well as the ability to test drive multiple vehicles of different brands, all from the same location.

Additionally, consumers wanted the ability to start the negotiation process online (56%) and complete credit applications and paperwork online for faster service on the day of the sale.

Getting on for three quarters (72%) claimed they would visit a dealership more often if the buying process were improved and 66% claim they would be more likely buy from such a dealership that more closely delivered their ideal service, particularly with regard to online support.

Further research by MakeMyDeal, a new Cox Automotive company that enables car shoppers and dealers to discuss and agree on the terms of a car deal online, found that consumers also want to see an overhaul of the way in which finance and insurance (F&I) products are sold.

The MakeMyDeal 2015 Finance & Insurance Study found 61% of respondents were sceptical about such products, indicating they believe such options are just ways for the dealer to make more money. Additionally, 48% said that they would never buy anything other than the car from a dealership.

However, 84% said they believe that F&I products may have real value, and 66 % indicate that they think F&I products may save money in the long run. Despite this, 54% say they prefer to simply complete their purchase and leave the dealership as quickly as possible.

The study found 83% of respondents were interested in learning about F&I products before entering the dealership, with 75% overall (and 69% of those who are skeptical of F&I) reporting this made them keener on learning more about them from the dealership. Nearly two thirds (63%) said they would be more likely to buy F&I products if they could learn about them online in their own time, before finalizing their vehicle purchase.

“F&I is one of the biggest parts of the buying process that has still not moved into the digital age, and dealers have been hesitant to evolve this process because it’s a major profit center,” said Mike Burgiss, founder and vice president of MakeMyDeal. “However, our study shows that the current F&I process breeds consumer skepticism. By changing when and how the shopper is introduced to F&I products, dealers could see a dramatic change in consumers’ likelihood to buy F&I products.”