Car Dealerships of the Future

First, let me say that the last few new cars I purchased were pleasant enough experiences.  I am satisfied with the cars I purchased, and the price it was sold to me at.  No bones to pick

As a marketeer, I am revisiting the role that car dealerships play in society, and the efficiency of the current dealership model.  eBay, Autotrader and others have taken the bottom off the model.  Used cars can be easily sold via these web services.  Car manufactures have taken the top off the model.  I can pretty much go to any major car manufactures web site and shop for a car down to the VIN number.  In fact, two of my last cars, I knew exactly the car I wanted to buy BEFORE I set foot on the lot.  More importantly, in one of these instances, I went to a dealer close to home (where I could get local service), and they got the exact car I wanted from a distant dealer.

AutoTrader and JD Power data shows what happens to the average consumer when they enter into a dealer to purchase a car.  There is a great post on 25 Amazing Statistics on How Consumers Shop for Cars that illustrates the buyer satisfaction through the process.  I am going to deconstruct this a bit to make a point.

  • Experience – The buyer arrives at the dealer, with significant research already completed, to finally touch the car they want.  The analogy is waiting in a line for a roller coaster.
  • Interaction – They dealer employs a sales associate that facilitates the buyers visit.  Today, most of the sales training is focused on a low key, low pressure front end.  None the less, the buyer is now own the roller coaster and having fun.
  • Decision – All data gathered, buyer now ready to pull the trigger and decades of antidotal experiences come to the surface.  How do I approach the sale?  How to I play it with the sales person?  How many back and forth’s is it going to take between the sales person and their boss?  The decision is negatively emotional.  One of the most unbelievable things that a Dealer often does is herd the buyer into a small room with a finance guy.  This makes the process even more stressful, as a claustrophobia sets in.  Using our analogy, it is the end of the roller coaster ride.
  • Time – All of the time it took begins to set in as the process unfolds.  In the end, this time it takes really impacts satisfaction.  I think that this phase could also be called regret or remorse.  Not to use the roller coaster analogy again, but this is more like the morning after a “one night stand.”  The walk of shame.  The redefinition of a relationship between two people.  The wait for a call.  All if it becomes a Jumbo Stew of emotion.  That is what the prolonged time at a Dealer feels like.

In some sense, much of the process cannot be helped.  But is there a better way?

I think that there is.  The picture above reflects Apple’s methodology in redefining how technology is retailed, purchased and supported.  I think that car dealerships are ripe for a similar redefinition.  There are many statistics I have researched on this, but ultimately it led to a conclusion that redefining a car dealership could create two important things.  It could create a new cost structure.  It could create a new methodology leaving the customer significantly more satisfied.

At Steve Day Design, we do business, product and sales process design.  I have been interested in accomplishing this for car dealers.  Allot of research has gone into it.  I think that we have something to contribute.  Regardless, I would love to hear other thoughts on the subject.

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