Take look at the monthly statistics provided by the Federal Chamber of Automotive Industries (FCAI). What you’ll see is a slow downward spiral of new vehicle sales. It’s not all doom and gloom, Aussies still spend plenty of cash on segments not previously regarded as aspirational. For example people seem to have bottomless pockets when it comes to dual-cabs, with 80K outlays not all that uncommon.
But the market is changing via car sharing and car subscription services. Digital innovation is the key for resilient auto industry. Richard Dicello, the head of Gumtree Motors volunteered this opinion piece for EFTM, it’s an interesting read.
New car sales are often seen as one of the leading indicators of the economy, which is pointing towards some headwinds. According to recent data, Australians looking to buy a new vehicle within the next four years is at its lowest point since 2014.
However, the decline in new car sales is also being felt globally. Last year, the UK industry reported itsbiggest decline incar sales since the global financial crisis, while Germany’s Center for Automotive Research forecasted global car sales tofall to 79.5 millionin 2019, down from 83.7 million last year.
We are also seeing a completely new attitude to transport, led by the proliferation of ride sharing apps. This change in consumer mindset is often called mobility-as-a-service – meaning owning a car is not seen as a necessity it once was.
Without sounding too alarmist, it is important to acknowledge the challenges to our industry are grand. But so too are the opportunities. Dealers and automakers able to navigate this wave of disruption will have more cash to invest in the technology needed to meet the rapidly changing needs of their customers.
The changing customer journey
It’s not just attitudes towards cars that are changing, the way we buy them has also shifted dramatically. Gone are the long days of multiple dealership visits and multiple returns to seal the deal.
Customers are spending their time trawling through review sites, Facebook groups and online car buying forums. In fact, Roy Morgan reports that 67% of people intending to purchase a new vehicle in the next four years say that the internet is the most useful medium for information on their purchase.
While some innovative OEMs and dealerships are already embracing digital channels, more needs to be done to ensure our industry is diversifying how we operate and market online.
Through our conversations with dealers at Gumtree Cars, we’re aware that friction during the sales process has long been a challenge – one that hasn’t been easy to overcome. While there are many powerful, transparent, and customer-centric dealers out there, the mass media perpetuates only the negative experiences that customers have.
The objective, then, is one of providing a better more seamless customer experience – one that gives the customer more control and transparency.
A dealer’s tools must include digital
There’s a host of digital marketing tools dealers can use to find out more about their customers in order to provide better, more personalised service, anticipating a customer’s needs before they even step inside the showroom.
The basic toolkit is ensuring you have a strong CRM system and you’re activating and targeting campaigns across multiple media channels. For those dealerships looking ahead for future digital marketing trends, ‘mobile micro-moments’ are fast becoming a territory that FMCG marketers are focusing their attention.
Google defines a “micro-moment occurs when people reflexively turn to a device—increasingly a smartphone—to act on a need to learn something, do something, discover something, watch something, or buy something”. They are intent-rich moments when decisions are made and preferences shaped.
Dealers creating insightful content and present at all phases of the consumer journey will find, keep and win more over their competitors.
Creating customer loyalty
Once a customer drives off the lot in their new car, getting them to come back for regular service and maintenance (much less their next vehicle purchase) is key to generating revenue as car sales stagnate.
Historically, dealers have lagged behind when it comes to loyalty, with OEM loyalty hovering around 60%, dealers lag behind at 25%. According to research by DMEautomotive, customers who habitually maintain their vehicle at your dealership are 86 times more likely to get their next vehicle from you.
However, customer loyalty programs aren’t just about offering discounts. They use the purchase history and customer-provided data to present customers with timely and relevant offers; and they improve overall customer experience.
Creating a positive post-purchase customer relationship that exists over the entire vehicle life cycle requires time, processes and investment.
EFTM Disclaimer: This is not a paid post