Car Dealers:
1 Consumer in 5 Would Buy a Car Online

CapGemini:  One in Five In-Market Consumers Would Buy Online

While there is always a lag between stated intent and actual behaviour, the message in the study is unequivocable and the trend is clear. 

Not only are today's vehicle-shopping consumers online, they are ready to TRANSACT!

Key Finding:  Considering only in-market vehicle-buying consumers, 1 in 5 would buy a vehicle online if the capability existed.

How ready is your dealership for that?

While the headline captures the essence of the message, the subpoints are important for their interpretation of how a dealership and manufacturer should operate and where they should spend their money.  When considering only consumers who were in the market to buy a vehicle, the study also found:

• 80% of consumers use the Internet
• Consumer Internet use is non-linear and includes multiple information sources
• Only 30% of consumers are influenced by television
• Only 20% of consumers are influenced by print advertising (which includes newspapers)
• The 1 in 5 or 20% statistic is as of 2007 is up and from 2% in 2001.

So, do any conclusions come to mind?  When I read the study, here is what I thought of:

• Clearly the crowd has moved on from where dealers spend their advertising money.
• The premise / hope / wishful thinking that no one will buy a car online is no longer true.  It is already happening.  Dealers using Ai-Dealer's software have done it.  Pioneering car dealer Sid DeBoer at Lithia has done it at Lithia's new L2 used car superstore.  eBay Motors sells a car online once every 60 seconds.

Given the facts of the CapGemini study, which message do you think you should be going to market with... 

This one (and this is just a random ad that I picked)? 

Or this one?

As a car dealer or manufacturer, which one you would like to work doesn't matter (although you are welcome to spend your money as you see fit).  That being said:

• Which message do you think will be more effective with your consumers?
• Which message speaks to them in the language of trust over the medium that they use?
• Which message differentiates you from the others in your market?

To my knowledge, Sid DeBoer of Lithia was the first dealer to have gone on record as projecting which way the industry would go - see Automotive News, November 2005:  Click, Buy, Drive.  While it probably overstates it somewhat, in observing his actions and the other pioneers in this industry, I am reminded of the words of Theodore Rosevelt from 1910:

It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.

Whether you choose to sit safely on the sidelines while others gain competitive advantage with this Internet thing, or leap in with your management effort, attention and budget, is up to you.  Either way, the shopping cart model popularized by Michael Dell in other industries is here in automotive.  CapGemini's survey shatters any remaining doubt over whether consumers would use / value a shopping cart in their vehicle buying process.

And that brings up a common misconception about the role of the shopping cart.  To dealers with a shopping cart, it does not matter if consumers buy online using the shopping cart or if they start out that way, then come in to your store and buy.  The path to the sale and the measurement of success with the shopping cart is not measured solely by the direct buys.  No, to be successful as a Click and Mortar car dealership, the success criteria are:

• Does the shopping cart create more selling opportunities than the current state without it?
• Does the dealership sell more cars with it than without it - whether direct (via the shopping cart) or indirect (by following up the unsolds)?

Since this seems to be my day for famous quotations, I'll end with this:  while your opinion on the importance of a shopping cart to your future competitiveness is yours an yours alone, in the words of Michael Dell...

"The Internet is not going away, but flawed business models are..."

Ours is an age of unprecedented choice.  Just as your consumers now can choose how they wish to engage with your business and which information sources they choose to trust, you get to choose how you wish to engage with them.  Hopefully these articles are providing useful insight into the changing dynamics accelerating towards us.

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