3 Min Read • November 20, 2023
The Ideal Automotive Sales Process May Surprise You
Our industry has come a long way toward offering different paths to purchase for vehicle buyers. Shoppers can buy online, visit the showroom, or take a hybrid approach where they complete some of the steps online and finish in the dealership.
The ideal path is simply the one that works best for each individual buyer and leaves them feeling confident in their purchase. And that should come as no surprise.
Our latest Ease of Purchase survey confirms that buyers want options. The number of shoppers who completed all the steps at the dealership sat at 66% in October, while a healthy 27% started the steps from home and finished at the dealership. Only 1% chose an online journey from start to finish, while 6% chose to complete all the steps online and take delivery at the dealership.
The preference for purchase options is why dealers must adopt a modern retail strategy and invest in creating frictionless physical and digital experiences where shoppers can move effortlessly between online, in-store and back again.
Pinpoint Customer Friction Points
Dealers have worked hard over the last couple of years and have made record profits as a result. But this year, we’re seeing inventory coming back and profit margins shrinking. Identifying what’s working in the sales process and what’s problematic is essential to improving and succeeding in a more competitive market.
The biggest area of friction we identified in our 2023 Friction Points Study revolved around wait time. Price negotiating was rated as taking the most time, closely followed by waiting on F&I.
Wait time tanks customer satisfaction. For example, if a shopper had to wait more than 30 minutes for F&I, their Net Promoter Score (NPS), or likelihood of recommending the dealership to others, dropped nearly in half.
Tackle Friction Points Head-On
Disjointed systems and technology can cause a lot of duplication, frustration and wasted time. And this can impact the entire sales journey, whether a customer shops in-store, online or dips in and out of both experiences.
Both customers and dealers deserve a more unified experience when all the purchase steps are streamlined into a single workflow. This creates an experience that simplifies the selling and buying experience and honors everyone’s ideal first path.
Focus on areas that move shoppers through the process faster and make sure their questions are answered so they feel confident about the purchase.
Second, use your digital retail tool all the way through the sales journey — not just as a lead capture tool. Data from NADA shows salespeople who use the same digital retail tool in the showroom as shoppers use at home sell 16 units per month versus 10.8 for those who don’t.
Finally, examine your sales and F&I process to eliminate wait times. Consider how you can empower salespeople to complete deals faster and remove delays with proper deal guardrails to ensure profitability. Another strategy is to present F&I menu options earlier online in the buying journey. Studies have shown this approach gives customers the transparency they want, helps set better expectations, and allows them to move faster through the process once they’re in the F&I office.
There’s a lot of chatter in our industry about where the retail market is headed. But we can all agree consumers are in the driver’s seat, and the best strategy is to give them multiple purchase options and a frictionless buying experience.
The Ease of Purchase Scorecard is a monthly gauge of over 400 new car shoppers conducted by the CDK Global research team.