Making the Transition from Traditional to Online Car Sales

From the first dial-up tone, the Internet was destined to change the way consumers buy things. Early on the effects were felt in the travel industry, then book stores. Soon electronic stores began to see less foot traffic. Then Amazon changed things for countless brick-and-mortar establishments from Wal-Mart to local mom-and-pop shops.

Vehicle sales were one of the few things that seemed immune to the Internet of Things era, but that thinking has changed. It was only a matter of time before car sales went digital.

Research from Cox Automotive’s 2019 Car Buyer Journey found that car buyers spent 61% of their time researching online. Buyers aren’t just looking at dealer websites. Nearly 4 out of 5 shoppers use third party sites to research vehicles.

The Autotrader Digital Influence Study uncovered that those third-party sites are influencing the buying decision. A quarter of respondents said third party sites influenced their decision, yet only 16% said the same about dealer websites. If you focus on new vehicle buyers, only the divide grows wider. Over a third of that group said third party sites were influential, but just 17% said they were influenced by a dealer site.

Consumers take an average of 47 days to explore options online. They then spend almost a month narrowing down the options and doing more detailed research about the vehicles on their shortlist. After more than two and a half months of Internet research buyers finally, start reaching out to dealerships to get a firsthand look at vehicles.

This period before the buyer makes it out to the dealership is important for establishing not only what type of vehicle will be bought but where it will be bought.

The digitized buyer journey is a trend that’s impacting both new and used car sales. Buyers that prefer something brand new are using the internet to build the perfect vehicle and research prices. The digital influence has even bigger implications for used car sales given that used car purchases are on the rise. Used car buyers are using the internet to look for vehicles across a wider location range and gauge trade-in value.

The 2019 Car Buyer Journey notes digital retailing is one of the biggest trends. Buyers are becoming so comfortable with online car sales they are purchasing vehicles without ever seeing them in person from operations like Carvana. It’s a trend that’s been on the rise since 2016 when the Beepi Consumer Automotive Index noted that 52% of people wished they could buy a car online and 42% said they’d be fine buying a car without test driving it. Just as troubling for traditional dealerships is the fact that buyers are visiting fewer lots. The number has dropped from visiting 2.7 dealerships in 2017 to 2.3 in 2019.

If you’re ready to make the transition from strictly traditional to online car sales, you’ll need to embrace new strategies and put a plan in place for not only capturing internet leads but consistently nurturing them. Here’s how to succeed in car sales online.

Internet Car Sales Tips for Success

It’s time to adjust your selling strategy to win more business online and make more money. The internet car sales process is significantly different from traditional selling. In general, process goes something like this:

• A buyer does their research online to come up with a shortlist of vehicles they like.
• The buyer then starts searching to see who has the vehicles for sale.
• They’ll call, email, text or chat online to find out if a vehicle is available.
• If the vehicle is available, they schedule a test drive.
• After the test drive, the terms are negotiated online or over the phone.
• Financing and paperwork is handled online.
• The buyer comes in to sign the final contract and drive away with a new vehicle.

In some cases, the dealership will even deliver the vehicle to the buyer’s door, so they never have to leave home, except for the test drive. And some buyers are willing to skip that step to handle the entire deal remotely.

To get buyers to reach out and make contact, you’ve got to get your internet game plan together.

Provide a Connected Retail Experience

Just as car buyers are looking for more connected vehicles, they also want a connected retail experience. A connected retail experience seamlessly blends online and offline activities, which is what the majority of surveyed buyers prefer. Seven out of 10 car buyers are more likely to buy from your dealership if they can start the process online before coming in for a test drive.

Once it comes time to complete the purchasing activities, buyers want to handle at least part of the process online whether it’s at the dealership or at home. However, 89% of buyers still want to sign the final contract at the dealership. Accommodating this type of connected retail experience will put you ahead of the competition.

Build a Highly Informative Website

One of the primary reasons third party websites are so influential is because buyers find them to be highly informative. If you want to gain more attention online and get more leads, try adding the following elements to your website:

• Reviews about different makes and models - even ones you don’t currently sell.
• Videos that show the inside and outside of vehicles.
• Guides on the financing process.
• Calculators for determining trade-in value.
• A blog with news and timely information.

The goal for your website to be a resource for online car shoppers, not just a marketing platform.

Include Everything about the Vehicle Specifications on Listings

According to Cox Automotive’s research, vehicle specifications is the #1 reason a buyer decides to purchase a certain vehicle. Specifications outrank reputation, price, and dealership experience.

The inventory is what brings most online car shoppers to a dealership’s website. Every single vehicle should have a very detailed description with every specification listed.

Partner with Third-party Websites

If you can’t beat ‘em, join ‘em. That’s true for dealerships that are trying to compete with third-party sites. Right now, third-party websites actually drive more traffic to dealerships than the dealer websites. You can capitalize on their popularity by partnering with third-party websites in one of three ways:

• Add listings on sites like Autotrader.com.
• Offer to write an expert guest post for a third-party website or contribute information.
• Link to detailed reviews of a vehicle make and model if you don’t have one on your site.

Makes Things Easy on Shoppers

One of the downsides of using the internet is that shoppers are overwhelmed with information. At the beginning of the car-shopping process, many people feel confused, and that confusion can lead to frustration.

Car buyers note that the most frustrating part of the process is filling out the paperwork. Even dealers who purchase vehicles from ACV Auctions agree the simplified paperwork process is a major benefit. Take a page out of our playbook and work with the finance department to see what can be done to bring financial forms online. Currently, only 5% of car buyers said they were able to review and sign contracts online. Adding that capability to your website can set you apart from the competition, increase customer satisfaction, and help facilitate more car sales.

Another frustration is difficulty searching dealership inventory to find a vehicle. A robust inventory search tool is worth the effort and investment. Give car buyers numerous ways to search for a particular type of vehicle and filters to narrow the selection down.

Be as Mobile-friendly as Possible

There are two very good reasons your website should be as mobile-friendly as possible. 1.) Google practices mobile-first indexing. This means the mobile version of your website is what’s being used to determine where your site shows up in search results. 2.) Every year more people use mobile devices to conduct car research.

Well over half of people use mobile devices to do research and find vehicles, while desktop use has declined slightly. Furthermore, people are increasingly spending more time on mobile devices. When you’re building a website, creating content and developing tools, focus on how users will interact with these resources on smartphones and tablets so that you provide a good user experience.

Correspond by Email and Online Chat

Opening up the lines of communication online is the first step to making an internet car sale. Email and online chat are two options that car buyers are already open to using.

Autotrader, 2016 Car Buyer Journey

The key to email communication is a timely response. An autoresponder lets the buyer know you have received their email and will follow up shortly. It goes a long way in providing great customer experience and nudging the lead closer to a sale.

Online chat has grown substantially in the last three years. It can be used to answer buyer questions in real-time while gathering additional information about the buyer.

Build a Good Reputation with Online Reviews

Trust is a big factor when buying a car online. Buyers use online reviews to determine how trustworthy an online dealer is before they decide to make a purchase. It’s in your best interest to try to gain as many authentic positive reviews as possible. And if someone posts a negative review, it’s imperative that you respond immediately. The response should apologize for the poor experience and offer to rectify the situation. Doing so helps negate the effect of a negative review.

Have an Active Social Media Presence

An increasing number of online car shoppers are using social media sites during the car buying process. Only 2% of new car buyers first learn about a vehicle on social sites, but 10% use them to make a final decision on the vehicle they’re going to buy. As an online dealership, you can use social media accounts to promote specials, showcase vehicles, and connect with car buyers that are getting close to the purchase phase.

How to Be a Good Internet Salesperson

No matter how much of the process moves online, there will always be the need for salespeople to facilitate the sale. But salespeople in an internet department play a different role than salespeople on the floor.

Even if you’re a superstar traditional-salesman, that doesn’t guarantee the same level of success selling cars on the Internet. Selling online requires certain traits and skillsets you may have to hone.

Be a Data-driven Strategist with People Skills

Being an internet car salesperson isn’t easy. You don’t just sit back and wait to answer emails. There’s a lot of data and lead management that requires short-term and long-term strategies. Great written and verbal communication skills are a must as well. Plus, you also have to have people skills because the ultimate goal is to get the buyer into the dealership for face-to-face interaction. A good internet salesperson is equal parts left and right brain.

Understand the Internet Car Shopper

Internet salespeople understand that online car shoppers are a different breed of buyer. They expect that the buyer has done their research, is gathering information on the first contact and isn’t likely to buy right after the test drive. They also know that internet car shoppers are all about convenience, saving time, and getting a great deal. These things should influence the way you interact with internet car shoppers.

Be Free with Information

Internet car buyers expect an online car dealer to be free with information when they call, email, or text. Provide specifics on price, vehicle condition, and specifications. If the buyer likes what they hear, they’ll schedule a test drive.

Know Your Inventory Inside and Out

Internet car shoppers are more informed than most consumers. Salespeople have to know their inventory, or you may end up in an embarrassing situation where the buyer is filling you in on the details about a vehicle. If your dealership’s inventory includes hundreds or thousands of vehicles, it can seem overwhelming at first. Start by learning the essential information about the best selling models. Each day pick a new vehicle to study until you’ve mastered most of the inventory.

Quickly Follow up with Every Lead

Internet car shoppers expect quick follow up when they make contact. Remember, online shopping is about convenience and easy access to information. If you miss their call, make sure to call them back within a few hours. Answer email within the same timeframe.

Have a CRM system in place for ensuring follow up happens for every single lead multiple times because you may not get a response in the first few follow-ups. Every salesperson in the internet department should know the first response and long-term follow up process by heart so it’s consistently implemented.

Be Up-to-speed with Online Tools and Resources

Internet car salespeople have to be just as tech-savvy as shoppers. You need to know how to use the latest customer relationship management (CRM) tools, car financing calculators, car review sites, social media sites, etc.

Make Sure Leads Know to Schedule the Test Drive with You

One of the biggest hurdles for internet car salespeople is the lead not understanding you’re there for more than information. To get the sale, internet departments must handle things from start to finish. Too often the lead will make initial contact with the internet department then come down to the dealership and purchase a vehicle from someone on the floor.

As an internet salesperson, you have to let leads know they should contact you when they’re ready to schedule a test drive. Explain that you can have everything ready to go and save them time at the lot. That last part is sure to get a positive response from internet car shoppers.

Many industry insiders are predicting that online car shopping will overtake the traditional process within the next few years. No matter how consumers buy their vehicles in the near future, you’ll set your business up for success by taking steps to facilitate the internet car sales process, you can best prepare to sell cars online.