Carvana expansion shows the importance of growing online car sales

Carvana announced this week it had opened its brand new campus in Georgia, which is one of its largest campuses and will add 1,500 jobs in the state. This marks yet another expansion for the used car retailer, which has grown exponentially since its incorporation in 2013 and now reportedly has over 10,000 employees. Carvana’s CEO Ernie Garcia said the retailer is hoping to continue its growth, saying that Carvana “remain[s] committed to [its] continued expansion within the region.”

Carvana has said it hopes to employ at least 3,500 more people in the Atlanta area in the coming years.

Much of Carvana’s online car sales success can be attributed to its technology. It has long been documented that car buyers despise the time it takes to visit multiple dealerships, look at various vehicles, take test drives, hear some sort of upselling sales pitch, and fill out stacks of paperwork before they can finally leave the lot with their used vehicle. Compared to traditional car sales, customer satisfaction in regard to online car sales has jumped dramatically in the past few years, meaning expanding online shopping capabilities increases customer happiness and can lead to more business.

Simply stated, growing online car sales is important because it seems to be what customers want.

Growing attraction for online sales

Carvana all but eliminates the need for in-person interactions, as it now can even deliver customers’ vehicles to their driveways. Not only has Carvana revolutionized the used car buying process with its fancy high-rise vehicle vending machines and advanced technologies, but its success has been a telling lesson for dealers on the importance of digital growth and moving towards processes that are based more online. Expanding online car sales saves both dealers and customers time and there is none of the traditionally-abhorrent sales pressure involved.

Shifting to more online car sales can save time because customers will be able to see exactly what car they would get without having to see it in-person. Until now, most dealers have just featured pictures of used vehicles at different angles and a few of the inside features, but the success of Carvana’s “Car360” technology makes it clear that dealers should provide more in-depth, up-close, and detailed photos of each specification on and inside the vehicle. This would take away the need for the initial, lengthy visit to a dealership, saving time for both dealers and buyers.

Online car buying can also be more appealing to shoppers, as they can browse for a car they may want or find the exact one they are looking for through online means. Consumers, especially the younger generations, prefer to shop for all types of goods and services on their phones, and Carvana’s success clearly hints to dealers that they need to have excellent “car finders” on their websites and mobile apps. Carvana’s ongoing expansion is highly due to its ease of use and availability, so dealerships who expand their online search capabilities may bring in more business.

It should be noted that despite the importance of growing online car sales, dealerships may be able to find a good balance between traditional and online sales. Retailers like Carvana have nuances in their contracts that many car buyers are opposed to, such as the inability to test drive cars before having it delivered to their homes and subsequently having to return it within 7 days if they are unsatisfied with the way it rides. Other customers are still uncomfortable signing legal documents and providing payments electronically, especially for a large purchase like a car.

Ultimately, dealers should definitely get up to speed in the digital realm because customers prefer it, but at this point it doesn’t necessarily mean dealers will be obsolete if they don’t transition to fully-virtual means.

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