Online retail has been laying waste to bricks-and-mortar shops of all varieties. Widespread cutbacks and closures of store chains such as Macy’s and Borders underscore that consumers certainly don’t mind having a blouse or a book delivered to their doorsteps with the click of a mouse. Those items often show up at reduced prices, too. For some consumers in sprawling suburbs, where navigating boulevards lined with strip malls can be a chore, internet shopping has been a godsend. So, where does the rise of online retail leave sales of cars and trucks, or more specifically, the physical dealerships, which are just bricks-and-mortar car stores?
At the 2017 National Automobile Dealers Association (NADA) convention in New Orleans, some speakers forecast a looming online car-sales boom. Mark O’Neil, chief operating officer of e-commerce and marketing firm Cox Automotive, told attendees at Automotive News‘ retail forum that 10 percent of all vehicle sales could be completely online by 2019. He said online retail could become a disruptive force in the automotive market similar to the way Uber and Airbnb have upended the taxi and hotel industries. He also said, however, that the owners of dealerships would not have to worry as long as they adapt and invest in their online offerings, Automotive News reported.
Going the Way of the Horse-Drawn Carriage?
Ford president and CEO Mark Fields appeared to be alluding at least partly to online disruption, if not to Tesla’s vertically integrated model of direct factory-to-consumer sales, when he told dealers at the NADA convention that he has heard rumblings that the franchised-dealer model could become obsolete.
But unsurprisingly, Fields added: “I want to say unequivocally that Ford firmly believes in this franchise model. We believe dealers are an essential part of our industry’s and company’s future.”
Ford, for its part, has previously acknowledged that not everyone likes spending time at dealerships and is trying to give car shoppers more online options for the buying process. The automaker announced last month that it is partnering with AutoFi to let shoppers apply for credit and buy or finance vehicles from dealer websites. The move comes after Ford commissioned a Harris poll of 1000 American adults that found 83 percent would prefer to spend as little time as possible at a dealership when buying a new car or truck. However, many of those same respondents also said that they would like to be able to touch and feel a new vehicle before buying one.
A Ceiling to the Sales Boom
Another survey, done by eBay Motors in 2013, showed that only 13 percent of millennials said that visiting a dealership would be their preferred method of car shopping or researching an automotive purchase. Among shoppers over 35 in the survey of 1028 adults between ages 18 and 60, 51 percent said they would still prefer to visit a bricks-and-mortar dealership. Only one in five millennials, though, said they would consider actually purchasing a vehicle using a smartphone, tablet, or other mobile device.
“I definitely see it shooting higher,” Clayton Stanfield, senior manager of dealer relations for eBay Motors, said of online sales. Even with a purchase as complex and hefty as an automobile, some buyers can know certain cars or trucks well enough to buy them without feeling compelled to see one first. “I’ve had five Volvo XCs,” Stanfield said. “I don’t need to drive that car to know what it’s like.”
But Stanfield said he also sees a ceiling to any potential online-buying boom. He said he doesn’t think a large majority—say, 70 percent—of car buyers will complete a purchase online, because most people will still want to kick the tires of a prospective new car or truck in person.
You Can Play Mario Kart Online, But Is It Really the Same?
Despite the signs that people don’t like visiting dealerships, Beau Boeckmann, president of Galpin Motors, is not convinced that the experience at a physical car store has to have unpleasant associations on par with going to the dentist. It’s why Galpin Motors has installed video games such as Mario Kart inside kids’ play areas, for example. Galpin has been pioneering for a while, starting with being the first to open a full-service eatery in a dealership—the Horseless Carriage Restaurant, in 1966—and more recently replacing the typical dealership coffee station with a full Starbucks store.
“We try to make it a whole fun experience for people to be there,” Boeckmann said of the group’s Los Angeles–area dealerships, which sell a dozen automotive brands through eight retail stores. It seems to work: Galpin Motors claims to be the top-volume Ford seller in the world.
“You can buy shoes online, or a suit online, and if you don’t like it, send it back,” Boeckmann said. “A car is different. It’s personal. The actual driving experience is a personal one.” He likens actually closing the deal on an automobile online to finding a spouse over the internet. Some couples may meet that way, but most people wouldn’t go to a cyber altar to exchange web vows having never spent time together in person. “Getting a new car is no different,” Boeckmann said. “It’s a relationship.”
from Car and Driver BlogCar and Driver Blog http://ift.tt/2kZxjTs
via IFTTT
0 comments:
Post a Comment