July 29, 2021

To improve digital retailing, build on lessons of 2020

To succeed at digital retailing, dealers should avoid thinking that their process must be perfect before rolling it out.

Instead, dealers can meet customers’ expectations by embracing simplicity and flexibility — even if that means developing a process and smoothing it out along the way.

The industry’s move toward wider adoption of online vehicle sales will evolve gradually, rather than as an overnight “brick-to-click” switch, dealers and auto retail technology providers told Automotive News last week during a virtual Retail Forum: NADA panel discussion.

Yet that transition accelerated nearly a year ago as the coronavirus pandemic forced dealerships to look at their virtual processes to counter the impact of showroom closures and plunging sales.

One of the lessons from 2020 is that digital retailing is only partly about technology, panelists said. More important are the process changes within the dealership group and the employee buy-in required so that online customers receive the same experience they would in a physical showroom.

“Technology is 20 percent of the solution here, and really process is 80 percent of it,” said Josh Berg, vice president of digital retail and consumer product for vehicle listings company CarGurus. “If the consumer does a bunch of work on a website and comes into your dealership and the salesperson has no idea who they are, it’s not only not a great experience, it’s actually worse, per our research, than if I just walked in cold.”

The next 12 months will bring opportunities to build on last year’s lessons, panelists said, as the industry refines its approach to omnichannel retailing. That term refers to technology and processes aimed at providing a seamless buying experience for consumers whether they shop online, in-store or both. While consumer surveys show increasing interest in completing more parts of a vehicle purchase online, many buyers still want to visit a showroom.

The industry also has work to do to ensure that dealerships of all sizes benefit from an e-commerce strategy, not just larger groups that have more stores and resources.

Asbury Automotive Group Inc., the nation’s seventh-largest new-vehicle retailer, launched its omnichannel retailing platform, Clicklane, in late 2020. CEO David Hult said the tool is designed to simplify the buying process, offer a better customer experience and retain the human interaction that has traditionally powered vehicle sales.

“If you talk to a consumer, what’s the best part about purchasing a car? It’s the test drive and taking the car home,” Hult said. “We’re trying to collapse everything in between, put the process in the consumer’s hand and be very transparent throughout the entire thing.”

Hult said that while larger groups benefit from economies of scale in digital retailing, “like everything else, costs will come down so the smallest dealer in the smallest part of the country can afford the software and give that experience to the consumer.”

Keeping technology simple helps customers and employees, particularly when the devices used at the dealership are the same ones used at home, said Jeremy Beaver, president of Del Grande Dealer Group in California. Del Grande employees use iPads to work with customers in stores, for instance.

“Sometimes we make it more complicated, or even more data-driven, than it needs to be,” Beaver said. “Whatever that technology is, if they can use it without having to have 26 different training modules, we’re probably going to be pretty successful with it.”

Natasha del Barrio, CEO of Bert Ogden Auto Group in Texas, said her group learned over the past year that a digital process doesn’t have to be perfect at launch. The group was slow to get “cradle-to-grave digital retailing” off the ground for that reason, with some “paralysis by analysis” until the pandemic began, she added.

“This really propelled us into a moment of, ‘Let’s just get it done. If it’s not perfect, that’s fine,’ ” del Barrio said.

“In that way, it really was a blessing because it pushed us into a place that we needed to be for the sake of our consumers faster than we might have gotten there on our own.”

A year from now, the industry will have applied the lessons learned out of necessity during the pandemic, said Gabe Garroni, senior vice president of sales for Ally Insurance.

“We’re going to take that and put it to good use, even if we don’t have to, because we’re going to find that consumers really do appreciate an alternative approach to business,” Garroni said.

“And I think universally, every dealer will have made some sort of significant change in their overall process.”