4 Min ReadDecember 6, 2023

Four Common Questions About Modern Retail in Automotive

Four Common Questions About Modern Retail in Automotive.

Modern retail is a term everyone is buzzing about. Yet, there are still a lot of questions about what it is and how it works. This uncertainty naturally leads to confusion and resistance to change. It’s time to bring some clarity to the topic. Read on for answers to four of the big questions frequently asked by dealership management.

What’s the difference between Modern Retail and Digital Retail?

Before you can answer anything else, it’s important to understand this key question. Automotive digital retail is a technology solution that allows consumers to have a retail experience on a dealer’s website, while modern retail is a portfolio of digital retail tools, dealership systems and internal processes that work together to serve customers in a virtual world. Digital retail solutions are a component of modern retail.

Is modern retail all about a path to sale for digital buyers?

This is a common perception but it’s not the full picture. Modern retail refers to any way of selling to today’s online customers. An online customer is anyone who uses the internet while shopping for a vehicle. So, we’re guessing about 99.9% of people! A few of these shoppers may buy a vehicle completely online but in the CDK Global Ease of Purchase monthly survey that number hovers near 1%. However, the majority go online to research vehicles and most complete some steps of the process before arriving at the dealership. Then they want to visit the dealership for the fun parts like taking a test drive. Modern retail is about putting the processes and people in place to meet each individual customer where they are in their own sales journey and following the customer’s lead in how they want to buy — whether that’s online, in person, over the phone, via text or some combination of these.

Do I have to change the way my team sells entirely?

Not necessarily. In fact, most dealerships have already taken the first step by adding digital retail tools to their websites. The next step is to add new in-store processes behind those tools to meet customers where they are. Take, for example, a customer who emails your dealership with a question about a vehicle in stock. The new process would be to follow the customer’s lead and respond with the requested information via email instead of picking up the phone and encouraging them to come into the store. If you change processes to meet the experience customers are asking for, it'll create a winning culture.

Remember: Customers are taking their own journey, interacting with some of your tools but perhaps not others. They’ll expect to meet a real person who’ll honor what they’ve done and will be their advocate. Your sales team will need to learn how to ask questions about needs and motivations, and how to move forward with each individual customer. One way to make this transition easier: Use the same digital retail tool a customer is using at home in your showroom on a tablet or kiosk. When you do this, a salesperson can sit side by side with a customer, pull up the deal the customer has already started, do a first pencil according to your dealership specifications, and send it to the desk for approval — all without leaving the customer’s side. Of course, your dealership controls the process and the terms of the deal, but it’s a collaborative approach that today’s buyers want and need.

Do I have to make a large investment to upgrade my systems?

In a word, no. A switch to modern retail doesn’t mean you have to scrap the technology you have and start over. In fact, tools like the CDK Global automotive digital retailing solution work well with CRM companies, trade valuation tools, lending solutions, etc. Everything is easy to integrate.

On a final note, sales agents who use digital retail in the showroom to work multiple deals at once close as many as 17 deals per month compared to the industry average of 10. Those are sales numbers guaranteed to motivate the rest of your team to give modern retail a try.

Learn more about digital retail solutions from CDK or request a demo.

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Jen Miller
By Jen Miller
Lead Product Marketer, CDK Global

Jen Miller is a Lead Product Marketer for CDK Global. She is responsible for assisting the company’s sales, implementation, and success teams with go-to-market strategies for current and new product offerings. With over 15 years of experience in business development and marketing strategy, Jen has helped execute business strategies to maximize profitability and retention.

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