The traditional vehicle buying and financing process is coming under pressure from a number of front, which are all changing a dealer’s business model to efficient online platform integrations. What this means for today’s dealers is that they must act now to onboard themselves to new consumer engagement strategies.
The “In the Trenches” presentation at Digital Dealer 22 will describe the changing environment of today’s consumer and their expectations from the point of view of a millennial who is also a finance executive involved in traditional lending along with FinTech.
With an understanding of today’s consumers from this point of view, you will be directed to a solution which consumers are desperately looking for. You will leave the session with the confidence that you can make an informed decision when choosing the correct e-commerce platform for your dealership or when building your own.
Today’s Consumer: Online Buying Expectations and Changes in Buying Habits
While consumers have unprecedented online access to information related to vehicle purchasing and financing, the reality is that the available information continues to lack transparency and ultimately results in consumer frustration and disappointment. The dealer’s value continues to be in dealing with consumer expectations and clearing up misconceptions. For instance, only one out of five consumers walk into a dealership thinking the dealer will do the financing, but four out of five walk out of the dealership after the dealer arranged the financing. The question remains however, why is there such a gap between pre-purchase intent and actual results?
The answer is that there is a gap between consumer perception of dealers and their potential contributions, including gulfs in trust, transparency and commitment.
Consumers’ buying patterns are also changing as consumers are becoming more payment driven in order to determine which vehicle fits their budget. The traditional method of budgeting by sales price effectively prevents comparison shopping by monthly payment, and is now giving way to a Shop by Payment paradigm that leverages trends in consumer internet searches and process transparency. This is the first step towards a full e-commerce solution for completing vehicle purchases online, being the future for vehicle.
The Dealer’s e-commerce Platform: Changing Dealer Business Models
To remain relevant and competitive, today’s dealer must adopt the role of a facilitator and embrace a delivery platform that reduces and/or eliminates traditional consumer pain points. Elements of this facilitator platform include promotion of trust and transparency, through offering the convenience and efficiency inherent in an online solution expected by millennials. However, simply digitizing the existing process is not a solution, which does not reflect the needs of this new consumer.
Choosing the right platform is therefore the key to preparation for this new era in vehicle transactions, where market share will be decided by a majority of consumers who would choose their next dealer to make their automotive purchase based on the dealer offering their preferred buying experience. This customer experience is the next competitive battlefield, and the view from the trenches is that online vehicle purchasing is here, now – it’s the expected Millennial experience and dealers’ roles will change, and dealers muse adapt or die – where eCommerce platforms are the future, and Shop by Payment is expected to be the new normal.
Join Eric Kaplan for his session “In the Trenches” at the 22nd Digital Dealer Conference & Expo this April 11th-13th in Tampa, FL, where he’ll share key predictions, as well as practical approaches and tools to remain relevant and competitive as we approach the new dealer-consumer business model on the horizon.
Author: Eric Kaplan
Eric Kaplan is the Chief Operating Officer at TREND Financial, one of Canada’s top auto finance companies with a management team that has extensive automobile finance experience, funding over $125 million dollars in consumer automotive loans to date, and included in Auto Remarketing Canada’s POWER 200 and PROFIT’s Top Startup 50 Companies for 2016. As C.O.O. and principal founder, Eric has pioneered unprecedented growth of TREND Financial in just over 4 years, where TREND Financial builds and grows with state-of-the-art technology and processes to service customers in a dealer friendly environment. Prior experience includes positions as Chief Compliance Officer, Quartz Capital Group, and Project Manager at CarCap Leasing.