The United States is in the thick of the novel coronavirus pandemic, and experts are unsure when social distancing practices will be loosened. What’s clear is that the nation has a long way to go – several weeks or months – before Americans will be free to resume normal activities outside their home like shopping for a vehicle.
And when it comes time, what will normal activities look like? Out of caution or fear, it’s highly unlikely that it will ever be ‘business as usual’ again. Whether it’s an apprehension to be among the general public or an aversion to touching common surfaces, car dealers will have to adapt business to whatever the new normal is going to look like.
Dealers will need to become innovators to return to the same sales volume as before COVID-19.
Online selling processes were slowly filtering into the business before the pandemic began. However, it’s become evident that the full sales process, from initial contact to signing the final docs, will need to be available online for those who wish.
Digital marketing director for Bakhtiari Auto Group, Roland Perez, says, “I think this has opened the eyes of the dealership world that you basically need to be able to do 100 percent of your transactions online. A lot of dealerships across the U.S. are understanding that this is the way we’re going to have to do things moving forward,” he says.
It puts pressure on dealers in states where, currently, documentation all needs to be physically signed rather than digitally.
Mobile Service Options
Dealers across the continent have jumped aboard the ‘pick-up and drop-off’ strategy to be able to continue servicing their customers’ vehicles. This is a new benchmark that dealers should expect to maintain after the restrictions are lifted, but it could go beyond. Mobile technicians with mobile hoists may be used to service customers’ vehicles on-site rather than bringing them back to the shop.
Traditional messaging with customers likely won’t translate in the same way with a changing face of retail. Rather, the goal will be even more so to retain customers the attract new ones. It will involve omnichannel campaigns that take an innovative approach – in-vehicle marketing through infotainment systems, and presumptive campaigns for sales and service through an app. Keeping the brand and dealer front of mind will be fundamental.
A Return to Vehicle Orders?
Factory orders are a thing of the past. Is it possible that factory vehicle orders may return, catering to a customer’s aversion to visiting a bricks-and-mortar storefront? It may be a good idea for dealers to brush up on the availability and timelines associated with factory orders, should it fit a customer’s desire.
Is the Common Dealer Model Viable?
The longer the social distancing practices are enforced, the more we can expect long-term change in retail. Expect consumers to be hesitant to be in public spaces, greeting someone they don’t know well. Large, busy facilities are likely to be slowest to return to profitability if the traffic doesn’t resume to normal volume, both for sales and fixed operations.
What’s unknown is how customers will respond. Small stores may feel ‘safer’. They may be inclined to deal with a single individual for their transaction, start to finish, requiring talent that can perform the sales and F&I task in one. Even more extreme, could the large store model be replaced with a small showroom and nearly 100% offsite demos and sales?
No one knows what the environment will look like once COVID-19 starts to recede. It’s obvious, though, that dealers will need to quickly innovate and adapt to remain relevant.
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Car Biz Today, the official resource of the retail automotive industry.