The recent ‘Car Buyers Report’ by AutoTrader has once again got the automotive industry talking – particularly around a common frustration and mistrust of the vehicle purchasing process on behalf of the consumer. This week, we have been looking at what some of the findings mean for the industry.
Of those polled, 14% of respondents thought the customer journey had worsened, while more than half believed the car-buying experience had remained the same. Worse still, some of those polled admitted they ‘dread the thought’ of purchasing a new model.
This, when coupled with common pain points – across all ages – around hidden costs, inaccurate information, mistrust and a fear of being ‘ripped off’, make it clear there is still significant work to do.
The true cost of automotive finance
With 90% of cars bought using some form of loan, it’s disheartening to read that one in five people thought the finance process made the entire transaction more difficult. The cause of this? A perceived lack of transparency over the ‘actual’ final price.
While buyers can search for deals using online calculators – which consider their desired monthly payment and deposit amounts – the vast fluctuations in the end-price is becoming something of a bugbear, particularly amongst those aged 18-24.
Of course, digital searches fail to account for the customer’s own credit score and their suitability for prime and sub-prime lenders, but when the buyer does come to make their final purchase, a soft search – tied to their unique financial situation – will ensure both parties find a suitable lender partner.
Treating customers fairly
This ties in with the FCA’s guidance around establishing what a buyer can afford and what they’re happy to pay each month – as well as any deposit and balloon payments – a compliant dealer can use the soft search function to work backwards from that.
Better regulations from the FCA and banks are helping to implement transparency throughout the process, with people understanding what they are paying, what they are getting for their money, and how much commission their business will earn the dealer.
It’s not all bad, but there’s work to do
Interestingly, 24% of purchasers believe the process has become easier. This is largely due to changing buyer trends – and the way they have impacted how people gather information – technology has adapted, and now presents a vast amount of data in a much more efficient way.
Automation and improved search functionality means a consumer has a wealth of information at their fingertips from the very first stage in their journey.
While there is no getting away from the disjointedness of the process, thanks – in part – to a boom in online shopping, buyers have come to expect a slick experience across the board, but sadly, it appears as though the motor sector is still lagging behind.
Move to an omni-channel model
In an ideal world, a dealer should be able to load an individual’s information and preferences into their point of sale software as soon as they step onto the forecourt – picking up at the same point on the customer journey.
In reality, and although the shopper has already done enough research to know exactly what they want – and how much they want to pay for it – when in front of someone else, they effectively return to square one and need to explain how they have arrived at their present position.
Due to buyers’ penchant for online research, dealers need to adapt, and not view themselves as there to ‘sell’ but to act as the facilitator of a sale. By moving to an omni-channel model, buyers would benefit from a seamless shopping experience – whether that’s online, over the phone, or in store.
In these changing times, those who will ultimately flourish are beginning to realise that the key to success is by implementing a sales process which not only is seamless and pain-free, but one which strives to be transparent and put the customer at the very heart of it – from beginning to end.