Why selling cars online should be the next step for your dealership

As Elon Musk announces that the end of Tesla stores is here, we find out if selling cars online is an opportunity not to be missed from Paul Stokes, head of online retailing at GForces. At CDX 2019 on June 12 he will be hosting the workshop ‘Why end-to-end online retailing should be the next step for your dealership’ alongside Katie Newton from RRG Group, a dealer group already offering this to its customers.

‘IS THERE an appetite from consumers? I think massively there is,’ says Paul Stokes confidently as we discuss whether car buyers are really ready to complete their entire purchase on a dealer’s website.

‘I can look at other industries and see that customers are digitally savvy, they’re already conditioned online by other industries and we should be no different. We’re only giving customers one way to buy and that’s the traditional sales process – that’s got to change.’

Stokes is the man leading GForces’ latest digital offering – NetDirector Transact – but his previous role as the managing director of digital dealership Rockar has allowed him to see first-hand this inclination for buying cars completely online – sometimes without ever setting foot in a dealership.

‘I think consumers have been ready to buy like this for a long time, if I’m being honest, and I think that as an industry we’ve been very slow to react to it,’ said Stokes. ‘We don’t think that consumers would want to transact a big-ticket purchase in this way. However, when you actually look at what a lot of retailers are doing at the moment, there’s a lot of what we would call half-baked e-commerce.

‘They’ll happily take a deposit over the telephone from a customer. The customer at that point probably hasn’t seen the car but what they’re not offering is the ability to transact fully – be that the ability to pay for the car online or go through a complete finance application process.’

Find out what our readers thought about retailing cars online here

Over the last 12 months there has been more appetite in the automotive industry to offer a way for customers to buy a car completely online, although mainly this has come from manufacturers allowing new car buyers a way to configure, pay and arrange delivery all from their own website.

For now, Stokes’ growth predictions for the number of dealers offering full end-to-end online retailing err on the side of caution but he expects that a year from now is when we’ll see at least 10 per cent of the market offering this – and that it won’t just be new car dealers.

‘In the automotive space, there’s an unwritten rule that says you have to buy a car a certain way. It’s very controlled, ideally the retailer wants to be face-to-face with the customer because they want to maximise the opportunity but the consumer is saying, ‘I don’t really want to buy the car that way’.

‘They want the easiest and most simple mechanism to buy from you and don’t need to be sold the car. The only way to deliver that in this day and age is through an online solution. You can’t deliver it any other way. The more traction we see, the more adoption we see at retailer and OEM level.’

Hyundai was one manufacturer to introduce the option to buy a car direct from its website in 2017.

However, GForces has also seen an increase in dealerships wanting to offer this but Stokes notes that a lot of apprehension comes from uncertainty around customers actually using the system and any infrastructural changes the business may need to make.

Based on the results it is already seeing, which Stokes will be explaining in more detail at CDX 2019, by offering a blended approach of online and in-store sales, dealerships are able to make it easier for more consumers to buy in a way convenient to them.

‘One of the things we’ve seen from RRG Group since launching at the start of December 2018, is that customers are willing to go through this whole end-to-end process. We’re already seeing this from the orders the business is starting to take online,’ Stokes explained.

‘I saw this first-hand working with Rockar as we introduced more stores. There was an appetite from customers to buy online or use a blend of both, visiting the store and test driving, but wanting to place the order from home. That appetite was there because it was an option and they didn’t have to come back into the store to place their order.’

This might not seem like the ideal solution for everyone in 2019, but Stokes warns that the next generation will be far more inclined to do all of their shopping online – including new and used car purchases.

He said: ‘As an industry we need to understand our customers better and how they want to buy. The one thing we’ve got to accept, and I’m talking probably in five to 10 years’ time, is that those people buying cars in the marketplace will be digitally savvy and they’ll want to order things from their mobile, order from their laptop or iPad because that’s how they’ve grown up.

‘That’s how they’ve always done things and it’s become part of the culture of the way they exist.’

Hear more from Paul Stokes at CDX 2019 by registering for your FREE ticket now. He’ll be sharing exclusive data from GForces’ experiences in online retailing, as well as examining how this has been implemented at RRG Group and the results they’ve seen already.