While selling cars looks a bit different in a post-pandemic world, shifts in consumer behavior and advancements in technology have created new opportunities to enhance the customer experience and improve dealership process efficiency.

Let’s take a closer look at a strategic approach for capitalizing on those opportunities to realize greater customer satisfaction and profitability for the long haul.

The Key Is the In-Store Experience

It may be surprising to hear from an automotive fintech company like Fuse that succeeding in today’s retail automotive market means putting as much emphasis on the in-store experience as on the digital side of the customer journey.

Good technology enhances life, and while today’s consumers live highly digital lifestyles, they still live in the real world—the physical world.

Sure, most car shoppers start the buying process online, but nearly all finish it in person—which is where the quality of the customer experience can become more nuanced. Therefore, the in-person, in-store experience is where dealerships really have a chance to shine and differentiate themselves.

Here’s why:

Buyers Still Want to Test Drive Cars

The test drive is one part of the car-buying journey that can’t be replicated online. Due to the emotional and financial investment that goes into buying a car, most buyers still prefer to test drive a vehicle before signing on the dotted line.

In its 11th annual Car Buyer Journey Study, Cox Automotive found that 22% of car buyers skipped the test drive in 2020. Even during the pandemic, the vast majority of car buyers still took a test drive before purchasing and reported higher satisfaction rates than those who did not.

Buyers Don’t Mind Waiting for the “Right” Vehicle

Repercussions from the chip shortage (i.e., leaner new car inventories) have driven some carmakers and car dealerships to adopt a build-to-order (BTO) approach.

But even as inventory issues begin to show signs of resolving, BTO continues to take hold.

How?

Thanks to global supply chain disruptions, retail shoppers in general have become less accustomed to instant gratification and more willing to wait for the products they truly want.

In the retail automotive space, premium and ultra-premium car dealerships (those selling high-end luxury makes and models from Aston Martin, Porsche, Ferrari, etc.) often have a dedicated configuration person in-store who sits down with each new car buyer to walk them through hand-selecting vehicle details and options.

However, this concierge-like customer experience doesn’t just resonate with luxury car buyers. It resonates with buyers of other makes and models, too. In fact, Don Jenkins, President of Jenkins & Wynne Ford, Honda & Lincoln in Clarksville, Tennessee, reported to Automotive News having sold 165 vehicles retail with only 40 cars on the lot.

Buyers Don’t Want to Spend 3+ Hours on the Transaction

Long desking times are by far the biggest pain point for buyers and the most significant profit killer for dealers.

When a customer comes into a dealership ready to drop $70,000 on a new car, the last thing they want to do is sit in a public lounge drinking lukewarm coffee.

The use of auto dealer finance software streamlines the desking process—even while customers are in the store—and helps get buyers from “hello” to “sign and drive” in as little as one hour.

How the Progressive Retail Approach Works

The aim of the modern retail model is to eliminate friction in the sales process and deliver a transparent customer experience.

It’s true: the right technology can help dealerships finetune the in-store experience and offer customers a more streamlined car-buying journey from start to finish.

But, like anything, there’s an okay way and a best way to approach technologically driven organizational change. Many dealers choose to invest in software solutions before their training staff—this is the okay way.

Progressive retailers have succeeded using a different approach:

One Price: The one-price sales model, also called “no-haggle,” “upfront,” and “value” pricing, means selling a vehicle at a non-negotiable price. Customers like the transparency of the one-price model because it levels the playing field among buyers. Sales teams like it because it makes their job easier and less stressful. Everyone gets the same price, and they don’t have to haggle for it. The right technology makes the transition to the one-price model seamless.

One Person: Single point of contact (SPOC) is a one-person sales process. Only one person works with a customer throughout the entire sales process, from vehicle selection and test drive, to F&I, signatures, and final delivery. Car shoppers like SPOC because it makes for a faster, more seamless, and personalized buying experience. Car dealers benefit from adopting a SPOC selling approach because it adds efficiency and makes customers happy (i.e., happy customers become repeat customers and refer friends and family).

The Bottom Line: Be Like Apple

Apple is a household name — and no, I don’t mean the fruit. The trust in Apple’s products is so implicit that many iPhone owners automatically buy the latest release when it becomes available — sight unseen.

The company could easily shut down its physical stores and put billions back into the bottom line. But instead, Apple continues to invest upwards of $8.5 million in opening each new brick-and-mortar store, adding to its global inventory of 500 physical stores and counting.

The leaders at Apple understand the value of product presentation, providing in-person support, and creating an atmosphere that reinforces its brand image. Having a physical store, when done right, can build brand loyalty by offering experiences that can’t be replicated online.

Even though many consumers want the car-buying process to be digital-first, the majority still want a positive in-person experience that aligns with what they encounter online. Dealerships today need to form a strong connection with car buyers online and in store.

Invest in “Temples of the Brand”

Regardless of where they initiated their car-buying journey, customers expect a unified experience. Remember: A dealership isn’t just the physical place where buyers sign contracts. It’s the space where customers can be made to feel special and confident in their purchasing decision.

Eighty two percent of people reported to Raydiant that a positive in-location experience makes them more likely to return to a physical establishment. Creating positive in-store experiences can help close more deals and keep customers coming back to one dealership for all their vehicle needs.

Realize Sustainable Dealership Profitability

The key to sustainable profitability lies in diversification. Putting all your eggs in one basket exposes you to risk when the market shifts and the bottom drops out of the one basket you have come to rely upon.

At Fuse, we highly recommend a multi-pronged modern retail approach that combines the one-price sales model, a single point of contact, the right technology, and ongoing training.

This approach has been proven to increase process efficiency, remove friction from the customer experience, and offer dealers more control and greater predictability for inventory allocation and sales. It also empowers dealers to sell more cars in less time.